Food Waste Management: A Path to Sustainable Profitability

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In the food industry, reducing waste is not only an ethical responsibility, but also a pathway to sustainable profitability. By implementing effective food waste management strategies, restaurateurs can minimize their environmental impact while optimizing their bottom line. In this article, we will explore the impact of food waste, understand its nuances, discuss the benefits of proper management, and provide actionable tips for reducing waste in your establishment.

The Impact of Food Waste

Food waste has a significant environmental impact, contributing to the emission of greenhouse gasses and the depletion of natural resources. In America alone, roughly 40% of food is wasted, which leads to increased landfill waste and pollution. Check 5 quick facts that can illustrate the real scale of food waste:

Estimate Your Savings From Cutting Down Food Waste


Financially, food waste results in substantial losses for businesses in the food industry. According to recent research, restaurant food waste amounts to $2 billion in financial losses. If this food had been saved, then it would have potentially provided an additional 200 million meals across the country.

Don’t also forget about your customer preferences when they’re deciding where to dine. According to recent polls, 72% of diners care how the restaurant handles the food waste and 47% would be willing to spend more money to eat at the restaurant with an active food recovery program. This means that not having a proper food waste management system in place can result not just in financial losses, but also in a negative impact on your business reputation and brand image
Moreover, improper storage and handling practices also contribute to spoilage and expiration dates being missed, resulting in even more financial setbacks for restaurateurs. This just adds on to the other losses, and on average a restaurant loses from 4% to 10% of the food they purchase. If you have a restaurant that spends $1 million on food costs, then such losses can result in $40,000 – $100,000 depending on the percentage of food that goes into waste. Think about how much money you’ll be able to save by decreasing the percentage of food waste?

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The Environmental Toll of Food Waste

While the financial and brand losses to restaurants are already big enough, the losses and consequences for the environment are even more concerning, since some of these could be irreversible:

  • Contributing to greenhouse gas emissions: Food waste produces methane when it decomposes in landfills, which is a potent greenhouse gas that contributes to climate change.
  • Depleting natural resources: The production and distribution of wasted food requires vast amounts of water, energy, and agricultural resources such as land and fertilizers.
  • Increasing landfill waste: Food waste takes up valuable space in landfills, contributing to the growing issue of overflowing landfill sites.

These environmental consequences highlight the urgent need for effective food waste management practices that can help us save the future as well as bring a positive change to your business.

Understanding Food Waste

Causes of Food Waste in Restaurants

It has been estimated that in commercial kitchens, 21% of food waste comes from spoilage, 45% happens during food preparation, and 34% comes from customers’ plates. On average, customers leave 17% of food uneaten.

In general, overproduction and excess inventory can contribute to the significant amount of food waste in restaurants. When restaurants produce more food than they can sell or store, it often leads to unused ingredients that end up being discarded. Poor inventory management practices also play a role in food waste, as inaccurate tracking and ordering systems result in expired or spoiled items. 

Categories of Food Waste

Preparation waste, such as trimmings and peels, contributes to food waste in restaurants. Despite being removed during the cooking process, these parts of ingredients are often discarded instead of being repurposed or composted. Additionally, unused ingredients or leftovers from previous preparations can become a significant source of wasted food if not properly managed and utilized effectively within restaurant operations.

Spoilage and expiration also lead to food waste in the industry. And as was mentioned above, Plate waste is yet another category of food waste that contributes to unnecessary disposal. 

Effective Food Waste Management Strategies and Benefits

The Benefit of Food Waste Management

Effective food waste management can lead to a net positive financial return. One of the recent studies, that analyzed more than a hundred of restaurants with different sizes and profits, states that the median benefit cost ratio is 7:1. Which means that for each $1 that the restaurants invested in the proper food waste management, they got (half of all restaurants in the study) returned $6. In terms of ROI (return on investment), it is more than 600% return. Based on this example, if you invest $10,000 in food waste management strategies, you may get up to $60,000 in returns.

Another similar study states that, for each $1 you invest, you can get $8 in return. The number of returns varies depending on the size, type, cuisine, and scale of your business, but 89% of the businesses that participated in the study, get a positive financial return.

It’s also important to add that positive impact or return from food waste reduction management doesn’t just purely rely on the financial benefit. The case study and multiple interviews display that non-financial side of benefit includes brand recognition, environmental sustainability, and food security.

Therefore, let’s go through the food waste management strategies you can start implementing NOW:

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Inventory Management and Planning

Effective food waste management starts with careful inventory management and planning. By keeping track of your inventory levels and closely monitoring expiration dates, you can reduce the risk of food spoilage and minimize wastage. Implementing a robust system that accurately predicts customer demand will help ensure that you order only what you need, reducing the chances of overstocking.

It is highly recommended to implement/purchase smart scales and measurement systems to help your staff measure and control the amount of food that goes into waste. It is suggested that the easiest way to know how much food waste you have is to implement the following measurement system: Bin 1 (Preparation waste), Bin 2 (Spoilage), Bin 3 (Plate waste). This way, you can measure each bin at the end of the day or at the end of each service, so you could know how much and which type of waste you’re producing weekly/monthly/annually. You can then use this data to calculate the waste cost.

Portion Control and Menu Engineering

Controlling portion sizes is crucial in minimizing food waste. By carefully measuring ingredients for each dish, you can avoid excessive portions that go uneaten. Additionally, menu engineering involves strategically selecting dishes that utilize similar ingredients to maximize their use while offering a diverse range of options to customers.

By tracking the amount of food you produce and waste (e.g. with smart scales), you’ll be able to see patterns and hotspots where you waste the most. Overproducing food or having way too big portions routinely can lead to huge losses.

Planet Promo deals from Ociety: food waste reduction movement

Turning Surplus Food into Profit

Establishing an additional source of revenue out of the surplus food items is another great food waste management strategy. There are plenty of the platforms that you can sign up for and start posting your surplus food deals to giveaway for free or with a discount. You can look into apps like Ociety, TooGoodToGo, and Karma (if you’re in Europe).

With the help of Ociety, you can turn your leftover pastries, cookies, salads, etc into a Planet Promo deal with a minimum discount of 40%! Such deals help to rescue your surplus food while also giving you a possibility to attract new customers.

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In addition, you can use Ociety at no cost to you and support a good cause, since Ociety donates to charity for various in-app activities, and encourages users to have fun while doing good. This way, you can not just reduce your food waste, but also help raise funds for nonprofits!

Food Donation and Composting

Donating excess food to local charities or organizations is an impactful way to reduce waste while contributing to community welfare. Establish partnerships with nearby organizations dedicated to fighting hunger like Food Bank for NYC so that surplus meals can be distributed instead of being discarded. 

For any remaining unavoidable food waste, implement composting programs which not only divert organic matter from landfills but also provide nutrient-rich soil for future agricultural use.

Engage with your Staff

Your team is one of the key elements of proper food waste management. They work directly with food, and they may know which flows and hotspots could be improved. The case study states that the staff has a huge part in determining the success of the food waste management, but they need more definition and guidance from the leadership or management team.

Provide daily staff meetings, training, or peer learning sessions to discuss how you can cut food waste, and what strategies you can implement. Encourage your staff to share ideas and suggestions, since in order for them to be as effective as possible, they need to be supported and properly equipped.

Monitoring and Measuring Progress

Tracking Food Waste Metrics

Implementing a digital tracking system is essential for effectively monitoring and managing food waste. By utilizing technology, restaurateurs can accurately measure and track data in real-time, allowing them to identify areas of waste and make informed decisions for improvement. Setting specific goals and targets further enhances the process by providing clear objectives to work towards, ensuring that efforts are focused on reducing food waste throughout the entire supply chain.

  • Implement a digital tracking system
  • Identify key areas of food waste
  • Set specific goals and targets for reduction

Analyzing Data and Making Improvements

Reviewing daily waste logs for patterns is an essential step in analyzing data and making improvements. By carefully examining these logs, you can identify trends and recurring sources of waste, allowing you to implement targeted solutions. Additionally, conducting regular audits helps to uncover inefficiencies that may have gone unnoticed. By involving your team members, you tap into their expertise and encourage a sense of ownership in finding sustainable solutions for reducing food waste.

Sustainable Solution from Ociety to Reduce Food Waste

Ociety’s Solution for Merging Environmental with Profit Sustainability

In the ongoing discussion on food waste, it’s becoming clear that solutions need to address not just the environmental impact, but also the economic implications for businesses. An emerging solution is in development by Ociety.

Ociety is working on an innovative system designed to effectively monitor food waste and recognize businesses making significant efforts to reduce it. By analyzing this data, companies can potentially gain insights into areas where they might save on costs associated with spoiling food and inventory management.

Additionally, as part of its initiative to promote sustainable practices, Ociety plans to introduce badges for businesses, serving as an acknowledgment of their efforts towards a sustainable future. While still in the developmental phase, such innovations hold promise in merging economic benefits with environmental responsibility!

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