Study quantifies cost savings of reducing food waste

In the United States, 40 percent of food is wasted throughout the supply chain. Photo credit: Getty Images/MementoImage

It’s no secret that one-third of the world’s available food either spoils or gets thrown away. In the United States, 40 percent of food is wasted throughout the supply chain. The majority of that loss comes from homes and foodservice industries, including the hotel industry. 

To combat the issue, last year the American Hotel & Lodging Association launched a series of pilot projects aimed at reducing food waste in the hotel industry. The undertaking found that participating properties reduced food waste at least 10 percent and in some cases, properties lowered food costs by 3 percent or more after increasing measurement and engagement. 

Now, new research finds there is a compelling business case for hotels to reduce the amount of food they throw away.  For every $1 hotels invested in programs to reduce kitchen food waste, on average they saved $7 in operating costs, according to Champions 12.3.

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Champions 12.3 is a coalition of nearly 40 leaders across government, business and civil society dedicated to inspiring ambition, mobilizing action and accelerating progress toward achieving Target 12.3 of the United Nations’ Sustainable Development Goals. Target 12.3 calls on the world to “halve per capita global food waste at the retail and consumer levels and reduce food losses along production and supply chains, including post-harvest losses” by 2030.

The study, “The Business Case for Reducing Food Loss and Waste: Hotels,” evaluated financial cost and benefit data for 42 sites—including Sofitel, MGM and more— across 15 countries, finding that nearly every site realized a positive return on its investment to reduce food waste. Within just one year, the hotels had reduced food waste from their kitchens by 21 percent on average, and more than 70 percent had recouped their investment. Within two years, 95 percent had recouped their investment.

The types of investments hotels made include: measuring and monitoring the amount of food wasted, training staff on new food-handling and storage procedures, and redesigning menus. Nearly 90 percent of sites were able to keep their total investment below $20,000, which was less than 1 percent of sales on average. This shows that the cost of change was low and the benefits were high for all businesses assessed.

The 7:1 return on investment comes from buying less food and thereby reducing purchase costs, increasing revenue from new menu items developed from leftovers or foods previously considered “scraps,” and lower waste-management costs.

“With these figures, I hope more in the industry will see food waste reduction as an opportunity and an important part of the hotel business,” Lionel Formento, director of food and beverage, Sofitel Bangkok Sukhumvit, said in a statement. “Our customers increasingly care about the environment, and that shift shows no signs of slowing down. Sofitel Bangkok Sukhumvit has prioritized reducing food waste as an important part of our sustainability efforts. From engaging management to our chefs and suppliers, implementing a food waste reduction program has helped us stay innovative and a leader.”

According to Champions 12.3, food loss and waste is responsible for $940 billion in economic losses and 8 percent of global greenhouse gas emissions annually. At the same time, some 800 million people do not have enough food to eat.

chart showing how often restaurants monitor food waste

The report recommends hotel owners and managers take a “target, measure, act” approach to reduce the amount of food wasted from their kitchens. It outlines five action steps for hotel managers, based on interviews with those who have implemented successful food waste-reduction programs: (1) measure the amount of food being wasted to know where to prioritize efforts, (2) engage staff, (3) rethink the buffet, (4) reduce overproduction, and (5) repurpose excess food. 

The National Restaurant Association, which also tracks food waste in the foodservice industry, also recommends donating leftover food that would otherwise be discarded to charity. About one in five restaurant operators reports doing so, according to the group. More than half of restaurant operators say they are concerned about liability issues, but the federal Bill Emerson Good Samaritan Food Donation Act of 1996 protects restaurants from legal liability when they donate “apparently wholesome food” in good faith to nonprofit organizations. 

The NRA also recommends composting as another way to keep food out of landfills. Fourteen percent of operators say they compost some type of food waste.

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