???

Grow your revenues – theopportunity in wasted food
Helping retailers manage food waste

Did your mom tell you to clean your plate during meals
growing up? While this action did not directly address theworld’s food waste challenges, it did sensitize you to notwasting food. Interestingly, the world produces enoughfood to feed every one of us, yet a huge number of people
live in hunger. Approximately one third of all food produced
globally is wasted or lost along supply chains every year.1
This costs $2.6 trillion annually and that wasted food could
feed the 815 million hungry people in the world four times
over.2 Producing food that will be lost or wasted meanssquandering time, labor, money, land, energy, and water.
Did you realize that, even today, the value of food wasted
in retail is double the amount of profit generated from thiscategory? A ReFED analysis report released in January, 2018,stated that in the US combined food retail profits were $9billion, whereas $18.2 billion in retail food cost was wasted.3
Sustainability attitudes also add to the urgency of addressing
food waste. Food loss and waste are not only a problem, butalso a source of amazing opportunity. These findings showthat solving food waste opens a substantial opportunity togrow revenue and margins.

Reasons for household food waste

1. Food gone past its use-by or best-beforedate
2. Food looking or smelling bad
3. Cooking excessive quantities of food
4. Impulsive food purchases or special offers
5. Trying to buy more fresh food or buying
too much foodReasons for food-retailer waste

1. Food-demand unpredictability, generating
overstock situations
2. A well-stocked shelf is considered key todrive sales
3. Manual markdowns are too deep,
indiscriminate, labor intensive and error
prone
4. Unable to comply with a first-in-first-out
sell-out process due to customer behavior
towards freshness and no incentive to buy
products expiring sooner
5. Promotions and other retail practices
factor in food waste, as the cost of doing
business

How food retailers can help consumers
reduce waste

1. Share reasons why food products land indumpsters rather than on consumer plates
2. Increase transparency and information
about food-production processes
3. Make food product information easy tounderstand4. Apply technologies to help consumers
quantify food wasted at home
5. Help consumers build strategies to cut
food waste at home
6. Create actionable awareness: engage
consumers and incentivize them, byrewarding them with lower prices for theirsustainable purchasing behavior

How do retailers tackle waste?
The smart use of information technologies along foodsupply chains creates opportunities to spur the adoption ofcommon standards, supply-chain transparency, and realtime information-sharing practices. If real-time is the newstandard for business insights, now is also the time to cut
food loss and waste.
Food waste reduction is part of a larger effort to improvesustainability for our global food systems. Each of us
has something to win, either through economic profit orenvironmental and social benefits. Several initiatives toprevent food loss and waste have proven financially soundand, even though food waste by retailers represents anoverall small percentage, these programs can generatesignificant benefits, to both the food system and consumers.

Food waste reduction
is part of a larger
effort to improvesustainability for ourglobal food systems.

Food-waste management
solution
Capgemini and its partners Toshiba TEC, Wasteless, Intel, andHanshow have developed an integrated end-to-end solution
to optimally mark down food prices. This has proven to be aneffective and profitable solution to minimize food waste.
A dynamic engine prices waste-prone SKUs, including
products such as meat, poultry, refrigerated prepared
meals, bakery, and premium foods, and integrates PoS withsell-out data, a date enabled barcode (such as GS1 DataBar,
2D or RFID), and shelf labels that display the sustainability
markdowns to consumers. Together this lifts revenues,
margins and reduces waste: in the aforementioned ReFED
report, Dynamic Markdowns are highlighted as one of themost profitable and scalable solutions to solve this pressingissue.

Solution components:••••

Toshiba TEC Point-of-Sale system
Hanshow electronic shelf labels (ESL)Intel processing technology
Wasteless waste-management and analytics
software and dynamic pricing engine, integrated
with the PoS, located according to a retailer’s
preference (on-prem, cloud, datacenter)• Capgemini knowledge, experience, andecosystem network in the food, agriculture,and supply-chain industries, including store anddistribution-center replenishment, and store
operations management.

Solution benefits:•••••••••

Reduce waste by as much as 85%
Increase revenues by as much as 25%
Dynamic pricing engine calculates the right priceElectronic shelf labels (ESLs) display actual
prices to consumer
Dashboard provides waste data insights to execs
and associates
App streamlines product on-boarding
Unleashes data to analyze and create supply
chain efficiencies
Reduces labor and suboptimal human decisions
Increases solution suite marketing to customer.

Timeline*
A Proof of Concept can be up and running in a matter of weeks, and deliver results from day one. Typically, a PoC runs threemonths, after which the solution may be deployed at scale without major additional integration.

Stage 1 (1–2 months)
IT Integration, data collection, store selection, commercial agreement, marketing program

Stage 2 (2–3 months)
Learning deployment in storesStage 3
Deploy at scale, roll-out throughout chain

Wasteless$2,29

GS1 DataBar
factory labelling

Product shippedto store

Shelf tracking$2,99

Automatic
markdown display

POS applies
markdown

Product is soldat optimal price*Timeline assumes deploying the GS1 DataBar, at the most efficient point in the packaging/
distribution process, at the supplier or in-store.
1.

FAO (2017). Key facts on food loss and waste you should know! www.fao.org/save-food/resources/keyfindings/en/
2. FAO, Global Food Waste and its Environmental Impact, en.reset.org/knowledge/
global-food-waste-and-its-environmental-impact-09122018
3. ReFED press release, January 2018 www.refed.com/content-hub/refed-analysis-revealsfood-waste-represents-18-2-billion-profit-opportunity-for-grocery-retailers

Conclusion
Retailers have the tools and insights to change consumer knowledge, mindset,and behavior. Food waste offers a strong case to improve margins for retailers andsuppliers. In addition, less food lost and wasted will help alleviate the burden on
the environment caused by agriculture, transport, and the disposal of food that isnever eaten. That means reducing food waste is not only about profit, logistics, orthe environment. It is also fundamentally a moral choice.

Ready to explore improving your bottom line by becoming a moresustainable store?

Contact one of our experts and visit

Europe/Asia PacificRevathy RajendranBusiness Development Lead | The Smart Digital Store
revathy.rajendran@capgemini.com
North America/Latin America
Genevieve Chamard
Business Development Lead | The Smart Digital Store
genevieve.chamard@capgemini.com
Solution contact
Martin van Vugt
Principal Consultant/Project Manager Consumer Products & Retail, Capgemini
martin.van.vugt@capgemini.com

AboutCapgemini
A global leader in consulting, technology services, and digitaltransformation, Capgemini is at the forefront of innovation toaddress the entire breadth of clients’ opportunities in the evolving
world of cloud, digital, and platforms. Building on its strong 50-year
heritage and deep industry-specific expertise, Capgemini enables
organizations to realize their business ambitions through an arrayof services from strategy to operations. Capgemini is driven by
the conviction that the business value of technology comes fromand through people. It is a multicultural company of over 200,000
team members in more than 40 countries. The Group reported
2018 global revenues of EUR 13.2 billion. With our industry-specificexpertise in retail, Capgemini helps you create a digital vision and atransformation road map to exploit technologies such as AI, machinelearning, conversational commerce, and computer vision. We know
how to optimize retail operations across the value chain, and equip
you to start projects today that enable and sustain you in the future.
Visit us atMACS_CS_ AP_ 20200113

www.capgemini.com

The information contained in this document is proprietary. ©2020 Capgemini.
All rights reserved.