Do you know between 33% – 50% of all food produced globally is never eaten? Around 88 million tons of food are wasted annually in Europe, with an associated cost estimated at 143 billion euro. At the same time, 1 in 9 people on the planet is starving or malnourished. In some developing countries, people are dying because there is no food. These people could be sufficiently fed on less than a quarter of the food that is wasted in the USA, UK, and Europe each year.
When we throw away food, we are wasting everything used to produce it. The water used to produce the surplus of food is 24% of all the water used for agriculture. The annual flow of and the greenhouse footprint from the waste ended in the landfill is 3.3 billion tons. Produced but uneaten food occupies almost 1.4 billion hectares of land and it produces a toxic chemical – methane.
The United Nation has listed food waste as part of the developed Sustainable Development Goals. G12 calls for ensuring sustainable consumption and production pattern. By 2030, it targets 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.
The stakeholders in the ecosystem are categorized into four main groups: farmers, fishers; food processors, wholesalers, supermarkets; local and national governments; and restaurants and individual consumers. A lot of efforts have been made to solve the food waste problem by matching the supply and demand of food. Today with the advancement of digital infrastructure combined with the concept of a marketplace, food sharing through digital marketplace becomes possible and cost efficient.
Business Model Innovation
Focus – Focusing on food rather than another category. If we solve the matching problem, and there is no leftover, the loop will be closed and the business model is sustainable. Unlike a marketplace for all kinds of consumer goods, some of which, after a few rounds of reuse and recycle, might still have a big amount of waste. Since food is the focus, everything is built around this category and it will be more efficient and credible for consumers.
Pooling – Bringing suppliers together so that a broader range of food choices can be provided to customers. Similarly, bringing customers together so that there are different needs and preference. This will increase the matching probabilities.
Sequencing – The sequence of the value change becomes more flexible. Customers can source their food from various retailers, restaurants, and farmers. Usually, customers will not have direct and easy access to all the farmers. Now food sharing platform is able to make everyone connected.
Digital marketplace – With the digital revolution and marketplace, this problem can be addressed more efficiently and benefit more people because of the network effect. Digital technology allows the platform to target a much broader geography, a region or a city instead of just a small community. In fact, everybody can be involved to reduce food waste and reduce environmental footprint. It enables each stakeholder to connect with anyone in the same value chain and create more efficiency. The platform serves as an exchange place. A seller can advertise their products with product specifications, quantity, delivery date, and method. A buyer can respond to an ad or create his own advertisement and state his requirement. The bigger the customer base is, the more impact there is. Imagine, there is only one marketplace for food sharing on earth, if everyone uses it, we could make sure no food is wasted while some people are starving.
Short-term and Long-term social and environmental performance
The digital marketplace can mitigate the issues of unbalanced food allocation after they are produced. It can help people who don’t have access to enough food to have cheaper options and at the same time solve the environmental problem and reduce greenhouse footprint. In the short term, it is a good solution to cope with the food waste and to minimize the impact of food production and consumption on the planet. It will also have a good impact on the local community because consumers will know the food provider and make connections with them. This encourages business within the community, and it will help the local business.
In the long run, not only will digital marketplace have a positive impact on resource efficiency and environmental impacts, eventually it will also provide food security to people in need. The released resources will be used for other activity that is needed in environmental and social aspects. Also, people will tend to choose to buy on food share platform instead of the market and it will help the market to find its true equilibrium production level. Lastly, it could slowly diversify people’s diet as people may try something just for the cheap price.
However, it has some potential risk. For example, it might encourage the habit of over-consumption and the sharing might worsen the situation since people feel less guilty to have leftovers. If we look at the whole value chain, there are still a lot to do to solve the problem at an earlier stage such as increasing the productivity of crops, reduce processing waste etc.
Source:
Food Waste Has a Big Impact on Climate, Water, Land and Biodiversity
http://www.fao.org/news/story/en/item/196220/icode/
http://blog.leanpath.com/leading-global-food-waste-dialog
https://www.theguardian.com/sustainable-business/free-food-sharing-leftovers-surplus-local-popular
By: Allison Chen, Clare Tao, Tulio Takeda, Huiting Zheng
Few questions. How do you think about food safety, perishability of goods and delivery models? Who is going to make money of this to set up the infrastructure?
Interesting article. I have one question as well. How will people who cannot afford food use mobile? web? marketplace? to buy the food? My concern was that most likely these people will not have access to any digital media as well. Thanks
I liked the article, and I think it’s a topic that in the next few years is gonna be key. I went last week to Vivatech and there were several startups focused on this issue, but with different approaches, from using wasted food to generate energy to use it to produce new food (cookies).