2: The imminent problem of food waste and business opportunity

on
Figure 1, Too Good To Go (Too Good To Go, 2021)

Let’s face it. Most of the food produced in the world today is either lost or wasted. Boston Consulting Group (2018) said that 1.6 billion tons of food, one-third of the total amount of global food, are wasted, and it was worth about $1.2 trillion. By 2030, food waste will reach 2.1 billion tons worth $1.5 trillion. It is not only environmental impacts, but also significant economic costs. This is the reason why an appropriate waste management is assigned as a critical priority for sustainable development (UNEP, 2011, UNHSP, 2010). UN’s Food and Agriculture Organization’s (FAO) research indicate that the costs of food waste amount to $2.6 trillion per year, including $700 billion of environmental costs, that is to say a compelling business opportunity.


Figure 2, BCG Flow Model (Boston Consulting Group, 2018)

Too Good To Go: Browse - Find - Rescue
Too Good To Go (TGTG) is one of the most leading platform for reducing food waste and carbon dioxide production. They offered to partners with restaurants, bakeries, supermarkets, and hotels to make "magic bags" with their surplus food as a third of the retail price. It will collect by the customers nearby at the designated time (often 30 minutes before closing). TGTG (2021) created marketplaces that connect food businesses that have surplus food with local customers are rescuing their food. TGTG started their business in Denmark in 2015, and it was rapidly adopted by 15 countries. They have saved 95.5 million meals, as 75,000 businesses have sold their products on TGTG so far and 45.9 million people signed up to their service. 


Figure 3. Business Model (Too Good To Go, 2016)

Olio: Share it, Strengthen it, Socialize it
Olio is a free-sharing mobile platform that allows users to post images of surplus food, description, and pick-up time and place to deliver food that others in the neighbourhood might want. Starting in London, 2015, and spreading to 50 countries, Olio has become the epitome of surplus food platform and reached fivefold increase in listing during 2020, and keep continuing into 2021 (The Guardian, 2021). The background of Olio's rapid growth is closely related to UK situation that actively responds to environmental issues. According to the most recent report by the Waste and Resources Action Programme (WRAP, 2021), the UK produced around 9.5 million tons of food waste in 2018. It estimated a value over £19 billion a year and with 36 million tons of greenhouse gas emissions. Broken by sector, more than 85% of food waste arises in households (70%) and food manufacture (15%). 

To tackle this, Olio connects neighbours with each other and with local businesses, so surplus food can be shared, not thrown way. Olio has 4.8 million users and most of the privates sharing transactions are free of charge, and not only food but also various items such as kitchenware, toys, books and gifts are sharing between users. 

Value: More profitable and beyond profitable
Figure 4, WIN-WIN-WIN model (Too Good To Go, 2020)

TGTG presented 'WIN-WIN-WIN' model of a win for everybody as businesses can generate revenue from surplus food, customers can buy food at great prices, and it reduces food waste as well. Obviously, it's also beneficial for TGTG as the company takes a commission on transactions. Furthermore, they raised $31 million investment at the beginning of 2021 and are already trying on their biggest expansion including US city such as New York and Boston. A new partnership with the Waze app, the Google-owned GPS navigation and more than 140 million users can navigate to economic and environmental food options while they are driving (Fast Company, 2021). 

Olio has now raised a $43 million from global investment firm so far and is expanding their investor such as food delivery firm Delivery Hero. It is a new, highly strategic investment for their next round. Olio (2021) has already partnered with Tesco, Pret a Manger, and Costa Coffee and works with food wholesaler Booker and Compass Catering. To scale up their business, Olio is now working with one of the fastest industry 'grocery delivery sector' such as Zapp, Gorillas, Getir and Weezy (Sifted, 2021). 


Using mobile technology plays a key role to support behaviour change of people for reducing food waste. This technological utilization of surplus food has obtained substantial attention and investment (Davies and Legg, 2018). New emergence of ICT-mediated surplus food redistribution in the last decade as both platform and smartphone technologies allowed easy access, and food waste problem became an issue of public discussion. Mobile applications have influenced on consumer knowledge and raised awareness of food waste problem. It also facilitates local community experience when they bought or shared surplus food (Farr-Wharton et al., 2014). 

Moore (2012, p. 190) indicates, "geography 'plays a determining role' in the transformation of what is waste in one place into what is value elsewhere" and it explains that accessibility and availability of these applications have a strong influence on the customer to identify their local community and marketplace as well. 

AS 'UN Sustainable Development Goal 12' pointed out, reducing food waste is a major indicator to climate change. Tech start-ups are more accessible to the public, and it is one of the most effective ways of reducing food waste and greenhouse gas emission with small changes of people's behaviour. Food waste is the imminent threat of the Earth and could be a great opportunity to tech start-ups with a mission to change the world.    

by Hojin Choi 

@Hojin0907



<Reference List>

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Davies, A., Legg, R., (2018) ‘Fare sharing: interrogating the nexus of ICT, urban food sharing, and sustainability’, Food, Culture and Society, 21(2), pp. 233-254.

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UNHABITAT (2010) Solid waste management in the world’s cities: Water and sanitation in the world’s cities, 2010. Available at: https://unhabitat.org/solid-waste-management-in-the-worlds-cities-water-and-sanitation-in-the-worlds-cities-2010-2 (Accessed: 8 October 2021).

Visram, T. (2021) ‘Your Waze map will now show you restaurants that are selling discounted leftover food’, The Fast Company, 17th August. Available at: https://www.fastcompany.com/90666431/your-waze-map-will-now-show-you-restaurants-that-are-selling-discounted-leftover-food

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