Food waste is one of the most significant problems facing the restaurant industry today. According to the US Department of Agriculture, more than a third of available food goes to waste along the supply chain due to inefficiencies in handling, transportation, storage, and distribution.
As one of the major players in the food industry, restaurants must streamline their supply chain logistics, from farms to the dining table, to minimize food waste.
This article looks into the role of logistics in cutting food waste for restaurants and how to implement efficient supply chain strategies. It also highlights the challenges that lead to food waste to help you improve revenue and profit margins.
Implementing Efficient Supply Chain Strategies to Minimize Waste
Food waste amounts to significant losses for restaurants. Any wasted food translates into wasted resources and lost revenue. Restaurants can reduce waste by adopting and implementing solid supply chain strategies to enhance efficiency. These strategies include:
Accurate Forecasting of Demand
Demand fluctuates according to the seasons. During the festive and holiday seasons, the demand for restaurant services and bookings is on the rise compared to other times. Adopting predictive analytics technology can help restaurant owners and managers accurately forecast demand. By analyzing data such as historical sales records, local events, and seasonality, restaurants can make informed decisions to align the production of food with the actual demand.
Adjusting Portion Sizes Based on Customer Preferences
About 4% to 10% of food that restaurants purchase is lost before reaching the consumer. A major cause of the loss is oversized portions. Adjusting portion sizes goes a long way in helping restaurants reduce waste. Managers can leverage a point-of-sale (POS) system with feedback software technology to monitor customer feedback and consumption patterns. Data from feedback can help match servings and portions to customer preferences.
Conducting Regular Supplier Audits and Improving Collaboration
Regular audit of your suppliers helps you identify weaknesses and areas of improvement. Consider whether they are reliable or adhere to quality and safety standards. You can go ahead and collaboratively establish clear expectations and negotiate favorable terms and guidelines based on your findings.
The Importance of Supplier Collaboration in Reducing Perishable Waste
Collaborating with suppliers has a host of benefits for restaurants. Such benefits include fast delivery of supplies, delivery of quality goods, and enhanced adaptability to changes in demand.
Faster Delivery of Supplies
Collaboration eliminates unnecessarily long lead times that translate to spoilage of perishable goods while in transit. Through a transportation management system (TMS), restaurant owners and managers can exchange live updates regarding the condition and status of supplies in transit. Both can collaborate to mitigate the hurdles that interfere with delivery through real-time open communication via EDI, APIs, and text.
Improved Communication
Through open communication, managers and businesses will stay updated on the availability of perishable supplies, eliminating the need for advance purchasing. This ensures that goods are purchased when fresh and just-in-time.
Apart from ensuring freshness and quality, on-demand purchasing reduces the chances of spoilage of perishable products while in storage. Open communication also creates room for restaurant owners and suppliers to agree on quality issues such as handling, transportation, and packaging.
Enhanced Adaptability to Changes in Demand
When restaurant owners and suppliers work together, they can predict demand more accurately and decide on the volume of products to supply according to seasons. Accurate demand forecasting eliminates the chances of over-supply of perishable products, reducing spoilage and wastage. Enterprises can leverage data analytics and live feeds directly with their suppliers to ensure they are reading from the same page and can respond swiftly to changes.
Leveraging Technology for Real-Time Inventory and Delivery Management
Developments in supply chain management technology offer actionable solutions for cutting food waste. Here are some of the advanced technologies for real-time inventory and delivery management.
Smart Demand Forecasting Systems
AI-powered demand forecasting tools help prevent oversupply by ensuring that supply is aligned with demand. For instance, through an enterprise resource planning system (ERP) you are able to manage your entire supply chain and predict demand to optimize your inventory. The built-in automatic alert feature notifies you when the supplies run too low and there is a need for fresh supplies, eliminating the need for stockpiling.
Transport Management Systems (TMSs)
About 7% to 15% of food wastage happens during transportation. Fortunately, restaurants can leverage advanced TMS to optimize shipping routes through data-driven insights, deliver fresher products, and reduce lead times. The TMS has inbuilt sensors that monitor temperature and humidity in real-time to help take the necessary measures in case the conditions are extreme.
Inventory Tracking and Management Technology
Inventory management systems (IMSs) and warehouse management systems (WMSs) are essential tools when it comes to tracking supplies. By integrating IoT technology into the systems, you can track and monitor the condition and levels of stock in real-time. Real-time visibility into your entire inventory helps optimize stock levels to avoid excesses and wastage.
Key Logistics Challenges Leading to Food Waste in the Restaurant Industry
Like any other industry, the restaurant sector has its share of logistical challenges that lead to food waste. Some of the key challenges include:
Inventory Management
Most restaurants grapple with inventory management processes fuelled by the short shelf-life of most ingredients and fluctuating demand. Managers find it hard to maintain optimal stock levels to meet customer demands without holding excess inventory.
Poor Collaboration and Lack of Automation
Poor collaboration and lack of automation lead to inconsistencies in the ordering process, poor customer service, and delayed delivery of essential supplies. IMS software can promote supplier collaboration, enhance mutual understanding of KPIs, and enable suppliers and enterprises to share information on the same portal for efficiency. Information sharing reduces lead times, improves the quality of supplies, and reduces waste.
Changing Customer Preferences
Customer preferences keep evolving, forcing restaurants to adjust or modify their meals and services as needs arise. Excessive menu modifications disrupt ordering patterns and stock levels and may result in unused ingredients and rejected orders, leading to waste. Restaurants can leverage technology to ensure transparency and visibility of the entire supply chain. Data collected from customer feedback can help prepare for changes in meals and service preferences.
Final Remarks
Food waste poses serious financial and environmental challenges for the restaurant industry. Restaurant owners and businesses must adopt strategic approaches to manage perishable supplies more effectively.
Collaboration and technology are some of the most effective ways to optimize supply chains for efficiency. However, it’s important to consult a credible logistics services provider to get you started with the latest technologies to help you cut food waste.
