How much is food waste really costing you?
Let’s talk about the real cost of food waste. Because what you think of as a few leftovers here and there could be putting a huge financial strain on your business, eating away at any profit you might be hoping to make.
In the UK, hospitality businesses lose about £3.2 billion a year to food waste, with the average venue throwing away around £10,000 annually. That’s money straight in the bin, and it’s not just the food itself. You’re also paying for the energy, labour, and time that went into prepping and serving it.
And it’s not just your finances at risk. Sustainability is a growing priority for customers, with 83% expecting the hospitality brands they engage with to take action on environmental issues. In fact, 57% say a brand’s sustainability practices directly affect how they perceive it, so neglecting this area could mean losing customers who care about the planet as much as their dining experience.
With all that in mind, where should you focus your attention to improve things? Well, most of the waste in your restaurant is happening behind the scenes. Around 45% comes from overproduction or prep waste (think about those dishes you made “just in case”). Then there are the 34% from customer leftovers, often because of overly generous portions, and finally, 21% from spoilage - ingredients that went bad before you could use them.
A lot of this can be avoided with some smarter inventory management. Demand forecasting, careful stock management, and rotating ingredients properly can help you cut back on waste without cutting corners. And you’ll see savings in other areas of the business too, from reduced disposal costs to more efficient operations, all ultimately contributing to a healthier bottom line.
8 ways you can reduce food waste and increase profits
Reducing food waste isn’t just good for the environment, it’s a chance to protect your profit margins. Here are some practical strategies that not only cut waste but can also make your business more efficient and profitable:
1. Manage your portion sizes
We’re starting with the most obvious one - portion sizes. Accounting for 34% of the costs associated with food waste, it seems obvious that oversized portions lead to unnecessary waste and eat into your profits. If you want to get this under control, look at which dishes are most frequently being returned to the kitchen unfinished; that way you’ll be able to make the necessary changes. Think about offering flexible portion options on your menu (like small, regular, and sharing sizes) to allow you to cater to different appetites while reducing waste.
2. Improve inventory visibility
Letting ingredients spoil is like throwing money away. Smarter inventory management can help here; follow FIFO (First in, First Out) practices, and make sure you’re not overordering. A good hospitality inventory management system can help you track stock levels in real time, spot trends in usage, and order what you need. A system that offers real-time alerts for expiring items can ensure you use what you’ve already got before it goes to waste.
3. Forecast demand
Fluctuating customer demand can lead to overproduction and waste. Looking at historical data, you’ll be able to predict busy periods more accurately. By preparing just the right amount, you can avoid the cost of wasted food while keeping your customers happy.
4. Reduce prep waste with training
Prep waste accounts for nearly half of food waste in hospitality. Training your team on portioning, cutting techniques, and efficient prep methods can make a huge difference here. Perhaps you could consider introducing incentives for reducing waste, turning it into a team effort?
5. Turn surplus into specials
Unused ingredients nearing their expiry date don’t have to go to waste. Get creative with “chef’s specials” or limited-time offers featuring surplus items. Promoting these dishes as zero-waste meals can even become a selling point for eco-conscious customers.
6. Cut disposal costs with composting
Food disposal isn’t just a hassle, it’s an expense, and reducing costs is an important part of increasing your profit margin; so, it’s worth looking at ways to bring that cost down. Composting programs can be a great way to reduce disposal costs while turning waste into a resource. Many regions now offer cost-effective options for businesses to compost food waste instead of throwing it away, so check out initiatives in your area.
7. Track your waste data
You can’t manage what you don’t measure. Using a hospitality purchase to pay system can help you to analyse waste patterns, identify problem areas, and take action. Tracking waste data over time will help you to spot inefficiencies and continually improve your processes, and the more efficient you become, the more profitable you’ll be.
8. Tell your customers
Customers are increasingly prioritising sustainable dining experiences. By showing a commitment to reducing waste through things like menu transparency and partnerships with food-sharing initiatives, you can attract eco-conscious diners and build brand loyalty. This should in turn lead to higher profits.
Harnessing technology to minimise food waste
Reducing food waste isn’t just about changing habits, it’s about working smarter. The right technology can help you track, measure, and manage food waste more effectively, all while protecting your profit margins.
Understand your waste with Food Waste Management Software
Knowing where waste is coming from is the first step to cutting it down. Our food waste management software gives you detailed insights into every stage of the process, helping you pinpoint the root causes of waste.
Imagine being able to see exactly which menu items are leading to the most leftovers, or which ingredients are being thrown away most often. Our software breaks down waste by category, unit, and even specific dishes, making it easy to spot problem areas.
But it’s not just about identifying waste, it’s about taking action. By integrating seamlessly with stock control and menu costing tools, the software helps you make data-driven decisions. You can tweak recipes, adjust portion sizes, or even rethink your menu to reduce waste without sacrificing quality.
The benefits go beyond waste reduction, too. With clearer insights, you can optimise your inventory, lower costs, and improve overall efficiency in the kitchen. It’s about turning waste into an opportunity to save money and run a more sustainable business.
Stay in control with Purchase-to-Pay Software
Overordering is one of the biggest culprits when it comes to food waste. It’s easy to lose track of stock levels, especially in busy kitchens. That’s where our purchase-to-pay software can help, enabling you to stay on top of your orders and inventory.
This software takes the guesswork out of procurement. Automated workflows ensure you’re ordering exactly what you need, based on real-time data and usage trends. You’ll avoid overstocking, and the spoilage that comes with it, while still having enough on hand to meet customer demand.
Supplier management tools also give you full visibility of your purchasing process, from orders to invoices. This not only keeps things organised but also helps you negotiate better deals and identify opportunities to save.
And it’s not just about ordering smarter, it’s about using smarter. Real-time alerts let you know when ingredients are nearing their expiry date, so you can prioritise their use and prevent unnecessary waste. Combined with efficient stock rotation, this creates a system where nothing goes to waste, and your margins stay protected.
Ready to tackle food waste in your business?
We’ve looked at how food waste impacts your margins, and shared some practical strategies to help you reduce it, from smarter portion sizes to leveraging the right technology. But real change starts with having all the information.
That’s where Access Hospitality can help. Our food waste management and purchase-to-pay software solutions allow you to track waste, spot inefficiencies, and make informed decisions that save money and improve efficiency, ultimately boosting your profits.
If you’d like to stop scraping your profits into the bin, watch our wastage video to see our food waste management system in action. Ready to take control of your food waste? Speak to our team today.