THE NUMBERS ARE SOBERING: 44 million Americans live below the poverty line; the number of food stamp users has increased 34% over the past two years. The percentage of consumers classified “food insecure” by the U.S. Department of Agriculture is the highest it's ever been, fed by a crushing recession that some fear could soon recur.
Supermarkets have succeeded in this new age of frugality by offering a healthy dose of value pricing and marketing on the front end. They've found plenty to like on the back end, as well, by donating millions of pounds of food over the past few years to local outreach agencies. It's a practice meant to strengthen community relations that also, they've discovered, saves them money.
“We didn't realize it until we started doing this that we're reducing our waste stream,” said Rick Crandall, director of sustainability at Supervalu-owned Albertsons, where the Fresh Rescue program has diverted more than 100 million pounds of food to local food banks over four years. “That's a hundred million pounds that didn't go in the landfill, and that reduces our costs.”
Supermarkets have a long history of donations. But it's only within the past few years that they've made a substantial effort to expand beyond shelf-stable products into perishable items like meat, dairy and produce. This is due to a growing commitment from supermarket executives to expand waste-reduction efforts, and it's facilitated by a network of food banks and food rescue organizations that have become more sophisticated about the way they operate.
“We absolutely are committed to only doing things that are real, not just nice marketing,” said David Dillon, chief executive officer of the Kroger Co., during a speech at last month's GMA Executive Conference in Colorado Springs. Through its Perishable Donations Partnership program, the Cincinnati-based retailer last year donated more than 42 million pounds of perishable food to local agencies.
Despite Good Samaritan laws that protect them from litigation, supermarkets' main concern with donating food is safety. Agencies, in response, have stepped up their logistics and handling in recent years. City Harvest, a food rescue organization in New York City that collects more than 80,000 pounds of food a day from area supermarkets and restaurants, runs a fleet of 17 refrigerated trucks, three cargo bikes and a refrigerated tractor-trailer, all driven by employees certified in safe food handling. Partner supermarkets, including D'Agostino's, Whole Foods Market and Fairway Market, set aside unsold food that's reached its sell-by date, which City Harvest then collects, inspects and redistributes to local food banks in the same day. The quick turnaround allows the nonprofit to focus on collecting and delivering fresh produce, which makes up more than 60% of its total haul.
In many ways, City Harvest operates like the retailers it works with. This month, the organization opened a 45,000-square-foot distribution center in the Long Island City neighborhood of Queens. To establish and maintain relationships with supermarkets, City Harvest employs a food-sourcing manager who travels around to stores, meeting with department managers and buyers.
“Over the past five years we have become more sophisticated about how we approach supermarkets and how we treat them,” said Matthew Reich, vice president of food sourcing at City Harvest. “We treat them as customers.”
At the national level, there's been a coordinated effort to hire away retailers and manufacturers in order to engage some of the country's largest supermarkets. Feeding America, which oversees 200 food banks and rescue organizations, including City Harvest, has forged partnerships with Wal-Mart Stores, Kroger, Food Lion and other retailers. In doing so, it has increased the amount of food it rescues from retailers fivefold over the past five years — from 98 million pounds to 500 million.
“We intentionally hire people from the private sector that know this part of the business,” said Vicki Escarra, president of Feeding America.
The result is a network of agencies that are a far cry from the volunteer-and-a-van efforts of years past. Food banks in Dallas and Phoenix utilize road-mapping technology to identify the quickest routes for drivers. Across the country, agencies are acquiring refrigerated trucks and establishing safety protocols that meet retailers' standards.
Supermarkets have pitched in to help fund these efforts. Wal-Mart, which partnered with Feeding America three years ago and now accounts for more than half of the yearly volume donated to the organization's food banks, buys refrigerated trucks for agencies so its stores can better divert perishable items.
“A lot of this food is protein-rich and highly desirable, like meat and produce,” said Julie Gehrki, president of the Wal-Mart Foundation. “Sometimes the only barrier for a food bank to be able to pick up this type of food is the truck, so the foundation is making sure any food bank that needs a truck gets one.”
Delhaize America, which started its food rescue program 11 years ago and last year donated 42 million pounds of food across its network of stores including Food Lion, Hannaford and Sweetbay, also purchases technology that helps its food bank partners operate more efficiently.
“For example, in Savannah, Ga., Food Lion purchased an industrial refrigeration unit for the community kitchen of the Food Bank of Coastal Georgia,” said Benny Smith, spokesman for Delhaize America.
At the store level, supermarkets have to ensure that employees aren't throwing away edible foods or donating inedible ones. At Albertsons, Crandall has developed a strict protocol for what employees should set aside, and how to store it. Meat and dairy products that are close to their expiration date get frozen. Produce gets refrigerated. Hot foods and any items made in-store aren't donated because they're too difficult to store and cool.
“We have very firm criteria about what can and cannot be donated as far as things with expiration dates, things that are perishable and where they need to be stored and how they need to be stored,” said Crandall.
Crandall also requires that each of the 97 food banks Albertsons works with have either a refrigerated truck or thermal blankets that can keep food cold for up to four hours. He's reassured by the fact that the agencies also inspect everything on their end, and then report back to him on how much food they were able to use.
“On average, they probably don't use anywhere from 3% to 5% of what we donate,” said Crandall. “They have standards, as well, and while we may think that banana only has three bruises, they may say anything with more than two bruises isn't acceptable.”
Upholding safety standards is equally important for Wal-Mart. Before the company began its partnership with Feeding America three years ago, Escarra said, it had to ensure the food banks had guidelines that met or exceeded its own. After that, Wal-Mart had to train employees at each of its 3,600 participating stores to ensure full compliance.
“We have put processes into place to help store associates donate the right items at the right times,” said Gehrki.
The extra effort can yield major savings for retailers. Crandall doesn't have an official dollar amount of how much Albertsons has saved through its Fresh Rescue program. Considering, though, his estimate of $85 a ton for landfill charges and more than 100 million pounds of food donated over four years, Albertsons has saved more than a million dollars a year.
The benefits can extend to marketing perks, as well. Feeding America and its network of agencies give credit to its retailer partners, listing them in promotional materials and emblazoning their logo on delivery trucks. City Harvest has a 25,000-circulation e-newsletter that frequently talks up its supermarket donors.
“We give them some marketing benefits to let the community know they're supporting hunger relief efforts,” said Reich.
The Grocery Manufacturers Association and the Food Marketing Institute are encouraging supermarket retailers increase their donation potential. “Food Waste Opportunities and Challenges” is a three-year initiative that calls on companies throughout the food industry to increase the amount of food they divert to compost, food banks and other sources, and to cooperate with one another in achieving maximum efficiency. Launched at last month's GMA Executive Conference in Colorado Springs, the program includes a leadership panel with representatives from Publix Super Markets, General Mills, the National Restaurant Association and Feeding America.
- Contact local food banks to see what foods they accept, and what support they'll provide.
- Develop safe-handling protocols so employees know what food to save and how to store it.
- Research further efficiencies that could increase perishable donations.
Over the past five years Feeding America, which oversees a network of 200 food banks, has forged relationships with some of the nation's top supermarkets. It partnered first with Delhaize America's Food Lion banner 11 years ago, then with Kroger not too long after that.
Three years ago, it landed the biggest fish of them all.
“We rescued some 500 million pounds of food in fiscal year 2011,” said Vicki Escarra, president of Feeding America. “Almost half of that came from Wal-Mart.”
With more than 3,600 Wal-Mart and Sam's Club stores and distribution centers participating, the numbers certainly add up. The initiative is part of Wal-Mart's effort to become a more efficient, more sustainable retailer. It's also a way to make an impact in communities across America, said Julie Gehrki, president of the Wal-Mart Foundation, the philanthropic arm of the company that's spearheading the donation effort.
“Our size and scale are tools for positive change,” she said.
Wal-Mart stores donate a wide variety of food, everything from shelf-stable items to perishables like meat and produce. To ensure proper handling, the company has safe handling procedures for employees to follow, and requires the same of the food banks that receive the food. Wal-Mart is also investing in its food bank partners, providing refrigerated trucks to agencies that don't have them.