Food manufacturing – don’t let your profits waste away.

A recent study commissioned by the Waste & Resources Action Programme (WRAP) has found the UK food and drink supply chain generates more than 11 million tons of food waste and five million tons of packaging waste each year. With an estimated cost to the UK economy of £5 billion, the government is pushing for food retailers and manufacturers to reveal how much waste their businesses produce annually.

WRAP identified Food manufacturing as the greatest opportunity for reducing food waste outside the home. The study highlighted a biscuit factory that lost 20 tons of biscuits for every 100-ton batch baked. Additionally, a further 6 tons were lost in onward processes including 2.4 tons lost by overfilling packs with more than the standard weight. Although this is a one-off example, other studies have found mass balance raw materials wastage as high as 16%. With increasing pressure to reduce costs it seems evident that improving production yields would be a good place to start. Although this may sound an obvious solution, the process is not necessarily straight forward. Before any improvement program can begin, the first step must be to not only understand how much waste you currently produce but also which product lines are the worst culprits. Businesses must collect accurate data which can be used as a baseline for measuring progress. This will allow you to identify key areas for improvement, an ‘attack list’ that can be used to monitor success and set KPI’s.

Historically, shrinkage factors used in production processes have remained unchallenged mainly because they have been rooted into existing budgets. In order for businesses to track the true progress, they must discard these budgeted values and benchmark actual figures. To achieve this you will need the correct toolsets in place. You must be able to measure and track current conditions and document improvements. You will need to accurately record a number of materials issued to each stage of the production process and the ability to analyze yields and shrinkage through the production plant including any co-products, by- products or downgraded materials. Wastage in the warehouse should also be captured, the amount lost on the floor or classified un-useable due to outgrade, date codes or human error must all be accounted for. Waste is not just discarded materials. It includes the cost of wasted raw materials, rework, lost production time, waste treatment costs, wasted labor, loss of materials to atmosphere and to the drain, as well as the excessive use of energy and water.

Other areas highlighted by the study included improving forecasting through collaboration with customers, suppliers, and partners; initiatives to recycle, recover or re-distribute food waste and changes in packaging specifications with a move towards re-useable packaging such as returnable and refillable containers.

To be really successful in reducing waste a shift in company culture from waste management to waste minimisation may be required. Waste minimization refers to waste prevention rather than reacting to waste as it occurs. Waste minimisation often results in substantial savings through reduced purchasing costs and more efficient practices; It requires a business to incorporate the design, purchase, manufacture or use of products and materials which reduce the amount of waste generated. Waste minimisation actually reduces the amount of raw material used and therefore a number of wasted resources discarded.

For more information on WRAP and to download the full report visit www.wrap.org.uk/retail

For more information, please visit our website at www.saglobal.co.uk

About the Author

Susan Mattea

Senior Business Manager with SAGlobal

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