How can I reduce food waste through effective inventory management?

By SYSPRO Pty Ltd on 07 October 2019

You may have noticed that food waste is trending on many media channels recently. This is an international crisis which we as the food industry must urgently address. It is not only an ethical discussion but consider how many Rands does your business throw into waste every year? A head of lettuce, or some meat trimmings might not seem like much, but every month they can add up.

Waste, spoilage, overstocking, and theft are all “hidden” food costs that can seriously impede your cash ?ow. Proper inventory management will help you uncover and reduce food waste costs and maximize your investment.

 “A sizable portion of all your operational costs is tied up in the products you purchase. Managing inventory is a way to maximize every rand spent, because it helps reduce waste, spoilage, and overstocking. A system with good checks and balances will also help eliminate the opportunity for theft.”

Here are 5 tips to effectively reduce food waste and control your food inventory:

Assign a Team

Just as food safety is a team effort, a team approach to managing food waste is far more effective that than individual efforts. Choose the people responsible for “owning” the entire inventory process—including how product is organized and received, used daily in production and stored. Make sure your team members understand and are adept at the inventory method you use. They need to know your inventory categories, purchase units, issue units, food inventory list, and more.

Make stock take easy and routine

Establish a set frequency for your stock count—weekly, monthly, yearly, or even at the close of each business day depending on your business size and systems. The more often you take stock, the easier it is to identify and correct problems. Organize stock control sheets to align with the location of products on your shelves. Two people make the process even easier—one can count, and the other can record the information on the sheet.

3 Consider minimum stock levels

Monitoring your stock patterns will help you focus on the opportunities and ef?ciencies of cross-utilization. If you discover that an ingredient is being wasted or spoiled because you don’t use enough of it, you can devise ways to integrate it into other product/dishes. Be sure to refer to your data when you’re changing menus, introducing new products or packaging with the aim of minimizing waste.

Inventory Management Software

Make your systems as effective as possible by considering food service inventory management software. Look for a solution that’s compatible with your ordering process, your recipes and formulations, and invoice systems so that you can easily monitor your cost of goods sold (COGS), stock valuation and trends. You may even want to consider one that allows you to perform physical inventory counts on smartphones and tablets.

Get the consumer involved

In the retail space, the consumer demand for fresh produce can result in food waste. A deliberate campaign to involve the consumer with discounts on short dated products can create a win-win situation. Using your stock management systems can link with the in-store promotions to ensure perishable products are sold before they are wasted.

Understanding your stock levels and the data patterns is key to ensure you can make the right decisions. To do this is not only the right thing to do for food safety and food waste, but is just smart business.


 About the Author

Doug Hunter currently heads up Professional Services for SYSPRO Africa. He has been a Scotsman in Africa for 30 years. He spent 14 of them at SAP through their initial to recent SCM solution growth. His last role there was Head of Africa Pre-Sales. He has worked in SADC, East, West and Francophone Africa. At heart he’s a manufacturing/logistics business professional - rather than an IT techie. His passion is to help companies discover and implement innovation using people, processes and appropriate business IT.

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