From Surviving to Thriving: Re-Capturing Potential Lost Expense in Food Waste

While the primary concern during the coronavirus (COVID-19) pandemic should be physical health and getting food to people in order for them to stay alive and healthy, the impact of the virus on the restaurant industry has been tremendous. Restaurants are an essential part of the food supply chain to millions of Americans every year. However, according to the USDA, up to 40 percent of the nation’s food supply is wasted each year – the economic equivalent of approximately $161 billion. As businesses, schools, government entities, and other public places, have been shutting down, many families are packing their pantries using grocery stores.

With government mandates on social distancing, it has taken the restaurant industry into a new operating environment. Still an essential part of the supply chain, the products that restaurants offer are more than just food. It’s a sense of normalcy and emotional support to clients in a time of extreme uncertainty. Now, more than ever, is the time to focus on the bottom line reducing our food waste and thus food costs in an effort to survive.

The Challenge

A recent survey by the National Restaurant Association found that 44 percent of restaurant operators have temporarily closed their restaurants, and 11 percent anticipate they will permanently close within thirty days. The COVID-19 pandemic has struck a chord across the entire restaurant industry, affecting both large franchises and local independent restaurants alike. While sales are down across the board, many restaurants are creating the perfect storm for food waste – a surplus of ingredients with shrinking demand.

With food costs easily representing a third of expenses, it’s imperative to both the bottom line and the environment to find a way to save this precious commodity. Prior to COVID-19, ReFED (Rethink Food Waste through Economics and Data) estimated that one in seven Americans experienced food insecurity, unsure of where their next meal would come. How can we band together as an industry to survive so that we can thrive after this pandemic? Perhaps, by going to the core of our business – taking care of the consumer. 

Creative Solutions

While the restaurant industry has already suffered during this era of social distancing, some of the most innovative solutions come from unprecedented times. No solution will work for every restaurant across the country, but by tailoring your business’s response to the needs of your customers, you can work to stay afloat amid this uncertainty.

Some restaurants have been able to quickly transition into a carryout or delivery model. Certain types of restaurants, such as pizzerias, are better set up for these operations, but many eateries can make the switch to these models that promote social distancing. Several third-party delivery companies, including UberEats, Postmates, Door Dash, and Grub Hub, have helped bridge the gap for restaurants who do not have their own fleet of drivers.

Other restaurants are also temporarily transforming their space into a grocery market, allowing customers to purchase their ingredients that won’t be used in traditional meal preparation before expiration. In a time when many grocery stores are running out of products, this invites consumers to see their favorite restaurant brands as a solution, shopping their inventory for necessary food. This creative form of hospitality, not only creates a new revenue stream for your restaurant, but also saves the precious food from heading to a landfill.

Additionally, in the case that you find your restaurant with more inventory than can be sold before it expires, there are several organizations that can help ensure that excess food gets to the people who need it most. For example, Feeding America, the nation’s largest domestic hunger-relief organization, has a tool where you can find your local food bank accepting donations. Also, DoorDash is providing at-cost deliveries via its DoorDash Drive fulfillment service to nonprofit organizations across the community, including schools, food pantries, and community health centers. This approach not only avoids disposal costs for those ingredients but can also provide a tax incentive as well.

While consumers and restaurants adjust to this new normal, it’s important to focus on surviving so that we can get back to thriving in the future. Generating any revenue from unsold food while feeding hungry people and reducing disposal costs is a potential strategy to do just that.