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Digital application helps to fix systemic food waste

Sector:
Wholesale and retail
Investment cost:
Low cost
Payback time:
0 Year(s)
Read more
Cost savings:
20 - 30% / 50000€
Digital application can help to reduce yearly waste by 20-30 %, which means about € 50 000 in a regular supermarket (up to € 100 000 in a hypermarket)
Resource type:
Food waste
Maintenance cost:
500€
Investment cost:
400 - 500€
Payback time:
Software and training cost is about € 400-500/month, which means a payback of one month

Retail chains have tools which were unimaginable ten years ago to help them replenish their stock just in time. Despite these developments, the amount of food wasted is still high. Systemic problems in the way food is ordered and handled are difficult to fix even with the latest automated inventory systems. SMall amounts of repeat waste can add up.

The best way to fix a systematic problem like this is to fix it at source. One retail store in Finland, Kauppavalmennus Ltd., used a digital application to analyse and remedy a persistent food waste issue.

The first step is to recognise the problem: waste, shortages and excess inventory. Whenever a worker notices something is out of the ordinary, he/she can scan the product with a regular smartphone and see all necessary information to determine the root cause and fix it so it never occurs again. Usually, this takes about 20 seconds.

In a 2016 pilot in nine retail chains, an average of 14.5 % waste reduction was achieved in 10 months. The cost of the software and training is about € 400-500 per month, which means it will be profitable after the first month. Reducing waste will also reduce shortages and work needed, which brings more savings. If done properly, reducing waste requires less work in the end.

Source

Kauppavalmennus is a company that studies, developes and trains processes and software in retail according to lean management principal, homepage, https://www.kauppavalmennus.com/briefly-in-english

Case study interview, 2018, Juha Ketola, Kauppavalmennus

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