Food waste is the food inventory that is discarded, expired, or uneaten; the causes of food waste are numerous. Food waste can occur anywhere within the food supply chain, from the farm to food manufacturing, retail, distribution and in most instances, by the final customer.
Globally it is estimated that over one-third of all food produced becomes food waste. This not only has a significant impact on a company’s profitability but has far-reaching environmental, social and economic repercussions.
Where is food waste occurring?
The place to start when looking to control your inventory waste is to work out where it is coming from. This can be achieved by conducting a food waste audit, to measure and track the amount of food waste that is occurring.
Is it due to improper handling, spillage, cooking mistakes, quality deterioration during transport or inadequate cooling and storage? Measure and record the quantities of waste and where it is happening, what and how much food inventory is being thrown out due to errors, perishability and overstocking.
The audit process is an ongoing task and should be a team effort to continuously check and monitor food waste and to identify areas for improvement.
How accurate is your inventory forecasting?
Most companies recognise the importance of strong and accurate forecasting. The more precise the forecast, the lower the risk of overstocking. Optimal demand forecasts help minimise food inventory waste, maximise production efficiency and streamline purchasing.
A robust and detailed forecast considers both historic data and real-time conditions, like the time of day, the day of the week and what is happening right now. Food inventory forecasts need to integrate all relevant data to make accurate and profitable decisions to reduce inventory waste.
Optimise inventory control
While companies work hard to prevent spoilage, most lack the necessary information needed to analyse the what and why of food waste. Automatic tracking of products by lot and vendor can provide greater insight into where and how food waste specifically occurs.
Leverage the right food manufacturing software to improve your inventory control parameters for each food inventory item, incorporating factors such as handling and temperature control requirements, shelf life and expiry dates.
Optimal inventory control is important to the overall health of your business. Knowing your food inventory types and volumes will assist in managing food inventory to maintain freshness, quality, improve the efficiency of your operations and to reduce food shrinkage and waste.
Inventory control systems can also ensure robust, high quality data capabilities to support advanced supply chain planning and optimisation.
Automated inventory replenishment
Using the results from demand and food inventory planning, replenishment planning provides visibility of future customer demands. Helping to accurately project product and food inventory needs, and determine the actions required by suppliers and manufacturer to efficiently satisfy that demand.
Replenishment planning can help businesses develop cost-effective strategies that ensure rapid replenishment cycles and high customer service levels while reducing costs.
In manufacturing, replenishment planning helps develop capacity plans and detailed schedules. Considering limitations, optimising changeovers and lowering the inventory of raw materials and finished goods.
For sales and operations replenishment planning can transform data from all functional areas such as sales, production, marketing and procurement into a central resource for analysis and decision making.
Food waste reduction
Food waste is no longer an issue of lost revenue and profitability. The ethical, environmental and social impact of food waste is such a global concern that governments are now addressing it as part of their environmental and sustainability policies. Any area, however small that works to reduce or eliminate food waste is a step in the right direction.