by Elizabeth Harris, Morrisons, Huw Davies, Tesco
While the motivation for retailers to reduce food waste is far beyond just simply the cost of lost profits, it is still the case that the lost profits from food waste and markdowns is staggering, often at over 3% of total retail sales, meaning lost profits in ten's, hundred and thousand of millions. The question this session will explore is where the budget for these lost profits sit within the organisation, and the key performance indicators set for each function in the business.
Leading the discussion, Elizabeth (Morrisons) shared the current thinking and where the budget and "ownership" of food waste and markdowns sits within their organisation (stores), and shared some open questions she has on where the budget should sit. To share a counter view, Huw Davies of Tesco shared their position, and where the budget sits in their organisation (Commercial) and the rationale for this accountability model.
The open discussion centred around the pros and cons of each accountability model, the factors that might explain why one model might be preferred Vs another. Several retailers shared that the budget sits with the stores because that is where replenishment orders are created and in-store production quantities are controlled. Others questioned what the role of the store was anyway in preventing food waste.
This session was part of the two day working group meeting for retailers, producers and academics only. To review the recording for this session and the others below click apply.
May 19th - Store Level Forecasting & Ordering - Retailer Case Study on the introduction of Machine Learning to Sell More and Waste Less
May 19th - Understanding the True Cost of Food Waste - Introducing a new financial model to count the true cost of food waste
May 20th - Retailer Case Study - Woolworths Australia journey towards zero food waste
May 20th - Smart Labels - The X5 business case
May 20th - Tesco and Olio - Introducing new ways to manage surplus food