Key considerations when planning to jump into the exciting world of food upcycling

According to WRAP, more than half of the food waste generated by the UK manufacturing and retail sectors is avoidable. Dairy production is the worst culprit, accounting for almost a quarter (23%) of total avoidable food waste in the UK. This is followed by meat, poultry and fish, which account for 18%.

But it doesn’t have to be this way.

The organisation’s analysis shows that a combination of preventing food waste being generated, redistribution of food surplus and diverting surplus to animal feed could lead to a 42% reduction in avoidable food waste, saving businesses millions of pounds a year.

The pressure is on our food and beverage manufacturers to reverse the trend and lead the charge in tackling food waste. They must address internal processes and procedures and support consumers in making better choices and developing less wasteful behaviours.

They are also expected to scrutinise and support supply chains, identifying where loss happens, and ensuring positive progress is made.

Of course, there is an ethical need to deal with food waste – and many sustainability and corporate social responsibility programmes have been established to set goals and engage stakeholders and investors on the progress being made.

Kraft Heinz has a target to achieve a 15% reduction in solid waste being sent to landfill, for example. At Nestlé, work is underway to halve food waste by 2030. Part of this involves working with smallholders to reduce food waste and loss at the local level in the supply chain.

But there are also clear commercial benefits to be had too; food waste is a hidden cost that harms profitability and inflates consumer prices. Applying new techniques and technologies to reduce upstream food waste could earn competitive differentiation. Dovetailing with this is the opportunity to develop new consumer product offerings which valorise waste streams.

With this mounting pressure to cut upstream food waste, upcycling has become an interesting prospect for many companies. This involves converting food waste streams into new consumer products or ingredients for human consumption.

But, as with many business decisions, there are unexpected and unintended consequences to contend with, and there is plenty to consider in making food upcycling viable and effective.

To partner, or not?

However, that’s not to say that collaborations between partners, or with third parties, cannot unlock upcycling opportunities. In fact, delivering a successful upcycled product demands a wide range of skills and technical capabilities. At a practical level, waste stream conversion can call for specialist technology and facilities. Similarly, deriving value from the process could require an extended product ecosystem.

This is where a partnership approach can be hugely beneficial. This can manifest itself in various ways – from raw materials sourcing and technology linkups to joint brand initiatives and investment.

A good example is the teaming up of Kellogg’s and Seven Bro7hers Brewing Co. the small beer brand. The latter’s limited-edition beers use the former’s ‘less than perfect’ cereals that didn’t meet its strict quality control measures. The result: rave reviews from customers.

Take a holistic view to upcycling

Beyond partnerships, there are three core factors to consider when thinking about embarking on a food waste upcycling project: the supply chain, the consumer and sustainability. Taking a systematic and holistic approach will help to identify which strategies are most viable, and where partnerships might prove most beneficial, for your organisation.

Supply chain considerations:

• Identify the origin of the waste stream. Is it internally produced or externally sourced?
• Assess availability. Where and how will you get your raw material? Are large volumes produced in a few locations? Or is it generated at low volumes across many sites (increasing costs and environmental impact due to transportation)?
• Verify technical procedures. What is the concentration of the desired component? How much processing is required to obtain it? Will it be a simple drying process or a more sophisticated multistep extraction?
• Establish costs. How expensive will it be to create an upcycled product or ingredient for human consumption? Could better value be achieved via alternative end uses such as animal feed or biogas production?
• What’s the USP? If the sustainability story alone is not going to be enough to sell an upcycled product, what else can you draw on to engage your customers? What additional benefits does your product offer?
• Is your product ‘acceptable’? Does your target audience(s) understand the concept of upcycled food waste? How will you communicate it?
• What’s your price-point? Are you consumers happy to pay the price you set? How much are they willing to pay for a product upcycled from food waste?

Sustainability considerations:

• Avoid greenwash. Think carefully about the claims you are making about your product. Calculating the financial value of a valorised waste stream is relatively straightforward, but wider sustainability benefits can be harder to quantify.
• What are the sustainability trade-offs? How do factors such as waste source, processing and packaging impact waste reduction, water and carbon footprint? There is limited environmental benefit if an upcycled product reduces waste but scores poorly from a water or carbon point of view.
• Leverage the experience of others. Make use of specific technical expertise and lifecycle assessment tools to inform decisions.

The opportunities to innovate in food waste reduction are vast. And the benefits could be far-reaching. Upcycling has a significant role to play alongside other strategies in the fight against food waste as the industry works to secure a sustainable food future. For companies that get it right, the benefits are clear: cut costs, gain the competitive edge and deliver exciting new products.