Can Labeling Impact Food Waste?
Is Zero Waste The Optimal Standard?
Cornell’s Brad Rickard To Present
New Research At The London Produce Show And Conference
Jim Prevor’s Perishable Pundit, June 6, 2016
Cornell’s Brad Rickard has graced the stage at both The New York Produce Show and Conference and The London Produce Show and Conference. Presentations we have profiled in pieces such as these:
What’s in A Word? Sell By, Use By, Best By And Fresh By.. Can A Word Alter Food Waste Significantly? Cornell’s Brad Rickard Speaks Out
Cornell’s Brad Rickard Returns To The New York Produce Show And Conference: Will 'GMO Free' Be The New Organic?
What’s In A Name? Professor Brad Rickard Of Cornell Produces New Research That Indicates Shakespeare May Have Been In Error… On Apples At Least
Cornell’s Brad Rickard To Unveil Generic Produce Promotion Research Done By Cornell And Arizona State University At New York Produce Show And Conference
When we learned he was willing to come to London and present research he is doing on food waste and how food labels can interact with that, we asked Pundit Investigator and Special Projects Editor Mira Slott to find out more:
Mira reconnects with Brad Rickard for a sneak preview of his London talk…
Brad Rickard, Ph.D.
Associate Professor of Applied Economics and Management
Charles H. Dyson School of Applied Economics and Management
Ithaca, New York
Q: How terrific you’ll be back in London to present your unique, science-based consumer research on food waste. Your controversial session last year, which analyzed consumer perceptions of GMO’s, jumpstarted the food waste topic from a different angle: Will reducing food waste be sufficient reason to embrace GMO produce?
At the New York Produce Show last December, you took on the food waste issue head on, unveiling initial results of your quantitative, ongoing consumer research. In examining the role of date labels, package size, and product category on food waste, you sparked a lively discussion among attendees.
Now you travel across the pond to share your latest research with a London Produce Show audience, which promises to bring new perspective to the food waste phenomenon.
Will your talk explore a more European slant? For instance, do you think you’d find different study results if you conducted the research with UK consumers instead of U.S. consumers?
A: Yes, and I do believe our results would change if the study participants were from the UK, which will make for an elevated discussion during my session. When I was in London last year, my research looked at U.S. consumer acceptance of GMOs in the face of genetically engineered deregulation of certain produce items. It opened questions about the contrast in consumer perceptions based on type of product, but also based on the country and region in which someone lives. I ended the talk by tying in the problem of food waste, and foreshadowed the research that I’ll be discussing in-depth this year.
In New York, I presented our food waste study and it generated a stimulating debate. So, I thought it would be interesting to revisit the debate in London with slightly updated research and a more UK/European-oriented outlook.
Q: Food waste has become a hot topic in the U.S., but are we playing catch up? Hasn’t global food waste and its massive scale been top of mind in the U.K. and Europe for a long time? What was the impetus for starting your research?
A: You make an astute observation. This is an ongoing project. It started when a friend and colleague of mine came to do a sabbatical at Cornell. Norbert Wilson, Professor, Agricultural Economics and Rural Sociology, College of Agriculture at Auburn University in Alabama, was interested in various food marketing and food quality questions, like me. At one of our meetings, he had just come back from a public health conference, where there was a presentation on food waste. It wasn’t an economist giving the talk, but someone in a health discipline interested in food waste from a public health perspective.
They had done surveys and focus group work, looking at how people were thinking about food waste. There was discussion of policy options, the idea of trying to sell less-than-perfect produce — the Ugly Fruit campaign — increasing donations to food banks, thoughts about using technologies to limit food waste and increase shelf life, and discussion of these date labels stamped on product as a way to communicate shelf life of food and beverages. The focus group work wasn’t a quantitative study; it was to elicit informal feedback.
Q: Did you think the survey inquiries warranted more controlled studies to build statistically valid data?
A: There was a sense that people thought labels were confusing. People were throwing away food that otherwise might not have needed to be thrown out. The surveys indicated consumers respond to labels on food, the information stamped on food, and so from the policy side, labels may be one of the most effective ways to reduce waste. However, the information gathered was subjective, there were no hard numbers, and Norbert and I are scientists, so we wanted to dig into this in a quantitative way.
Q: How did you go about that? Collecting accurate consumer data on produce consumption and food waste can be challenging. Is your study premised on generally accepted food waste data, or is that data hard to pin down as well?
A: We came up with an economic experiment to study the impact of labels on food waste in a pretty controlled and careful way. We did this for various types of food products, different package sizes and different expiration dates. By way of background, there’s been some statistical work done by the USDA Economic Research Service. Their analysis estimates the cost of food waste in the United States is approximately $160 billion per year.
Q: That’s a big number. Could you break that down into categories? How much of that waste is concentrated in fruits and vegetables? [Editor’s note… see study here]
A: Meat is the top category, about $50 billion of that $160 billion. About $30 billion is in vegetables, and dairy is also about $30 billion, and fruit is about $20 billion. People also talk about food waste in terms of the calories.
USDA and others talk about the average food consumption in kilocalories per person per day, and then they use this other measurement called the number of calories available per person per day, the measure of the food supply divided by the total amount of food available divided by the population. A common number is 3,800 kilocalories available per person per day. It’s not what we consume. It’s just what’s available. I think on average what we consume is less than that. Of the 3,800 kilo calories that are available per day, 1,200 calories is considered food waste. That’s a lot of calories.
When people give that statistic, they often point to the 17 million people in the United States who are food insecure.
Q: Could assessing food waste by calories create a distorted picture of the problem?
A: In the USDA report, looking at the $160 million of food waste, added sugars and sweeteners amount to only $6 billion, and added fats and oils only $13 billion of the total. When you go to the calories that are wasted per person per day, the largest categories now are not meat, dairy, vegetables and fruit. We’re throwing a lot of value away in meat, dairy, vegetables and fruit, but in calories the things we’re throwing away the most are actually added sugars and fats, but in terms of value, those two categories are relatively small.
If there’s any saving grace in this food waste story, most people would agree if we’re going to throw away calories, it would be good if it were in those two categories rather than in fruits and vegetables.
Fruit is 12 percent of the value and vegetables are 18 percent of the value of food waste. When you go to calories, fruit is 3 percent and vegetables is 3.5 percent. It makes sense fruits and vegetables are higher value products, but less calorically dense. My bigger point for bringing this up is that at least when we’re wasting calories, we’re wasting them in food groups that are less healthy.
Fruit is 12 percent of the value and vegetables are 18 percent of the value of food waste, and when you go to calories fruit is 3 percent and vegetables is 3.5 percent. It makes sense fruits and vegetables are higher value products, but less caloric dense. My bigger point for bringing this up, at least when we’re wasting calories, we’re wasting them in food groups that are less healthy.
Q: How does this change the conversation on food waste goals?
A: It helps when people talk about the optimal amount; we waste 30 to 35 percent of all food, which is a big number. That’s obviously too much food that’s wasted, but the next question is, should we have zero waste, 10 percent, 20 percent…? Sometimes in this discussion, there’s this complicit assumption that we should have zero food waste when we try to develop policies to reduce food waste. My point of giving these percentages of total calories is that maybe some food waste might not be such a bad thing. Because when we waste food in terms of calories, it’s in added fats and added sugars.
Q: One way to alleviate that problem is getting consumers to replace fatty, sugary foods with more fruits and vegetables…
A: If people have too much food on their plate, and a zero food waste directive, people could feel compelled to eat all the food on their plate, which could have negative consequences in terms of obesity and health. I say this with some hesitation, but I think a zero waste initiative might not be good. Sometimes when we waste food, it saves us time, or makes our life more convenient. Having free time and convenience are things we value as well. If you have a zero food waste policy, it could take away other things of value. I’m trying to wrap my arms around an optimal amount of food waste. It does sort of force us to make decisions about food.
Q: It’s a different discussion when talking about food waste from a consumer perspective as opposed to a retailer trying to reduce food waste within the store, or more broadly at the wholesale level, and down the supply chain…and in the context of sustainability and corporate social responsibility, donating to food banks, etc.
A: It will be nice for me to have more conversations with retailers, because this study was looking mostly at the ultimate consumer and how they make decisions when they take the product home. USDA statistics say about 31 percent of food is wasted, and 21 percent is due to consumer waste; the other 10 percent happens through retailers, and after product leaves the farm.
Some people say, ‘well the bulk of food waste is from consumers, so the policy initiatives should be targeted to that group because they make up two-thirds of the food waste story.’ But other people say, ‘well maybe, but there are a lot fewer retailers in the world than consumers, and if you can have a policy that makes a difference for that 1/3 of the story, you might actually make more progress because you’re dealing with a much smaller set of people.’ You could work with more incentives in a clearer way than with consumers.
Q: It sounds like it makes sense to attack the issue from multiple directions. For instance, from the retail, distribution and supplier side, a disrupted produce cold chain could degrade product and lead to food waste…
A: That’s a good point we should make, that there’s this estimated food waste at different stages along the supply chain. Consumers respond in a lot of different ways to food waste policies, and even though 2/3 of food waste happens with consumers, the other 1/3 is still a really big number, and it might be better to develop policies there that could make a bigger dent. We haven’t looked at retail incentives, but that’s sort of the next stage of our research, to move into that space of what kinds of marketing or policies could influence waste at the retail level.
Q: I’ve sidetracked you from previewing the consumer research you’ll be presenting to London Show attendees…
A: It’s all part of the story. And I think people at the London Show will have thoughts about this consumer issue, but they almost might be more interested in the policies designed to mitigate food waste at the retail level.
Q: I’m certain attendees will be fascinated to gain insight on the consumer side. Your research can provide important knowledge to produce industry executives at both the retail and supplier levels on how they can impact consumer buying patterns and food waste behaviors through package labeling strategies and merchandising practices…
A: Given that context, we’re interested in all of these different policies. Something I didn’t say earlier, there is the question about what is food waste, and then the question of how to measure food waste. There’s a lot of back and forth. For instance, in the fresh meat category, some people estimate the loss is around 40 percent, and others estimate it is closer to 20 percent, because a lot of that meat isn’t designed to be consumed, such as the bones or fat, and if never intended to be consumed, it’s not fair to count it as food waste. Similarly, you don’t eat the banana peel. With a lot of these fresh products, maybe we’ve overestimated the amount of food waste.
With some of the more processed products; some people think we might be underestimating the amount of food waste. There’s an ongoing debate, and it’s something we struggled with in our research experiment as well. We’re still actually doing work on figuring out, what is the best way to measure? If we’re interested to learn how much policy X effects food waste, then we need to find a way, to have a tool or metric to determine how much food is wasted before and after the policy is implemented.
Q: What metric did you settle on for this research?
A: We have a pretty good idea of how much food is wasted in terms of dollars, calories and percentages, and I’ve given you some of those USDA numbers. We were trying to think of a way in a laboratory setting to get people to tell us how much food is wasted in their household. It’s kind of a tricky thing because when you ask people directly, ‘how much food do you waste?’ for different types of food, we find they tend to under report compared to what the average USDA numbers are.
Then we tried asking, how much food do you consume? Here’s some food, would you buy it, and how much would you be likely to consume? If they said they were going to consume 80 percent of it, then we’d assume 20 percent is food loss, so we’re indirectly asking them how much food they waste. They tended to underestimate. We found these numbers to be slightly lower than average USDA numbers.
We’re trying to get answers that are pretty well aligned with the USDA numbers. What seems to be working best for us is a two part question approach. We give participants different food products, and ask what value do you place on this product in dollars and cents –if you went into the grocery store, how much would you be willing to pay for this particular food item, and then the second part, how much of it are you likely to consume based on your household experience.
Q: How does this give you more accurate answers?
A: A lot of people think about price when they make that retail buying decision. It’s a secret way to find out if someone really likes the product or not, determining value that may be different than the sticker price. We ask how much of the product their household will consume, and if they say 82 percent, then we take the other 18 percent in conjunction with the valuation to get an estimate of the cost or value of the food they throw out. And we find this seems to be the best way to characterize the amount of waste in a household when doing a survey like this.
We find this is the best measure to compare different strategies on the cost of household food waste. One way to think about it is the cost of discarded food, not just the sheer calories or grams but the grams with some financial value attached to it, that was quite a bit of work in itself on how to measure collection of food waste.
I started this story by saying Norbert went to this conference and these focus groups showed date labels were a pretty important attribute leading to the amount of food waste in the U.S. That combined with some additional research we did, if you go into a U.S. supermarket, you’ll see a wide variety of date labels used by manufacturers.
Q: Are there any rules on the use of these labels?
A: The truth is there is absolutely no regulation on when or why to use these different labels. You’ll see a date, and then some text, such as use by, fresh by, sell by, best if used before, a variety of these words. All these words have different meanings to different people, but outside of a handful of products, there’s no regulations on why, how, or when to use these words. In fact, it’s a fun exercise to go into the grocery store, and go into the yogurt section or you name it. Sometimes the same manufacturer uses different words for different sizes of the same yogurt product. Maybe part of this is just a marketing effort to communicate some kind of message.
There are really no federal regulations mandating something be true when using these labels.
The Idea of ‘use by’ with consumers may have something to do with food safety, but there are no rules that say ‘use by’ has any food safety meaning or connotation. If you see the words ‘best by’, or ‘fresh by’, or ‘better if used by,’ you’d think that’s a message about food quality, but again, there are no rules. And you’ll see the different labels used in the same category. Sometimes you’ll see the words ‘sell by’, and we suspect consumers may ignore that because they think that’s a deal between the retailer and food manufacturer, perhaps.
Some states have rules about eggs, and there are federal rules on dates you use for instant formula. Outside of a very small number of food and beverage items, it’s just how we interpret them. It was surprising to me how loosely they’re used and then how consumers respond to this type of information.
Q: Is the problem similar in the UK?
A: This lack of standardization could be interesting to the British audience, because it’s been written about by more people in England and there’s more thought going into how these labels are determined, and a bigger push to harmonize these labels as a way to reduce food waste. There is a group based in the UK, called the Waste and Resources Action Program (WRAP). It’s a UK-based charity program. One of its sub programs is called Love Food, Hate Waste, and it’s really at the forefront of this labels harmonization. I will definitely reference this in my talk.
Q: Has this organization done any studies to document the issue?
A: They have spent some time looking at this particular issue. They claim this is a problem but they don’t do the quantitative studies we’re doing to measure how the date labels affect food waste. It’s just more of a description of how they think or how panel or survey groups think, but they haven’t gone to the same trouble of measuring in a quantitative way.
Q: Isn’t this why what you’re doing is important when trying to determine proper allocation of limited resources? Science-based studies can corroborate or disprove subjective or anecdotal evidence…
A: Our research is not perfect. There are holes in what we’ve done but at least we’re making a start in trying to quantify these qualitative concepts, and figuring out how big a deal is this particular issue, which can help in making policy decisions.
Q: What did you discover in undertaking this research?
A: We set up this project to ask several questions, and now looking back, we may have tried to do too much, a problem we all have. We had six food products we included in our experiment: yogurt, salad greens and breakfast cereal. And for each we included a small size, regular size and a larger size of that exact same product.
We were curious about the varying degrees of perishability, the salad being the most perishable, then yogurt, then the cereal. And second, how does the size of the package impact food waste. Looking at this Costco effect, as we move towards buying bigger sizes of things to save money, does it also lead to excess food waste.
Some might say salad greens are the most perishable, but also believe there is inherently more risk in consuming salad greens than yogurt in terms of food safety. We’re trying to get an idea on the range of perishability and in some consumers’ minds there may be a range of safety concerns across these three categories. We think possibly these date labels may have differential effects across these products because of inherently different risk profiles.
To make things more complicated, of each of these six products, we actually run the experiment with three different dates for each product. For example, with the large tub of yogurt, we introduce the product to subjects when the expiration date is two weeks away, and reintroduce that large tub of yogurt when the date is 1 week away, and then again with one day away from expiration. They all include a date label and numerical date. There are three dates per product and six products, basically 18 opportunities for them to weigh in on the value of the product and likelihood to consume.
Q: Not to complicate things more, but a quick thought: Someone buying the large package of salad from Costco, might have a big family so it’s going to be fully consumed at dinner, compared to a single person buying a smaller size and only eating half of it, where the rest goes bad in the opened bag sitting in the refrigerator and needs to be thrown out…
A: Good question. After we go through this series of questions and valuation levels, at the end we ask people about their household, how many people live at your house, how many children, how often do you eat out, on a scale of one to ten, how much do you like salad, yogurt or breakfast cereal. And then we use all this information to control the statistical model. We basically make all the households equal, so that when we have an effect we can say it’s purely due to the product or the treatment.
We’ve already paid these people for a day of their time, and we leave time at the end to ask them these questions. Generally we believe they’re truthful. We never record who says what, it’s anonymous so people tend to be honest about these types of household questions.
One thing I haven’t said yet, we bring people into our lab, show them these products, ask them to tell us the value and percentage their household will consume as way to measure their discarded food. On different days we use different date labels. So if people come to the lab on Monday, we only use ‘best buy’, and when a different set of people come on Tuesday, we only use the words, ‘use by’. And the next Monday, always at the noon hour, we only use ‘sell by’. All the groups go through the same exercise, the only difference being the date label. As scientists we call this the treatment effect. We ran each treatment two or three different times to get a reasonable size sample.
Q: What was the demographic makeup, and number of participants?
A: We didn’t use any Cornell students. We used adults in the community. That sample is not necessarily representative of the U.S. population but it’s not terribly far off. We had about 200 to 250 people participating, a midsize experiment.
My guess is if we had UK consumers in the study it would change results. I’ll ask people in the audience at the London Show what they think. They could have different levels of trust in government agencies that regulate labels. In the UK they had some pretty serious food scares, especially the beef scare in the late 1980’s/1990sand questions on what government was doing with monitoring food items. A label on food in the UK talking about food safety would probably present a bigger trigger response than one suggesting food quality.
Q: What did your research show in this regard?
A: I’ll give you an overview of the key results looking at the average cost of discarded foods across all dates. Maybe not surprising, the cost of discarded food is about 60 cents when participants saw the label ‘use by’. It was about 45 cents when they saw the ‘fresh by’ language. It was about 40 cents with the ‘best buy’ language, and about 30 cents on average across all products with ‘sell by’. The cost of discarded food on average was twice as much when they saw ‘use by’ relative to ‘sell buy’, and with the other two labels, ‘fresh by’ and ‘best buy’, half way in between. That ‘use by’ label had the highest cost of discarded food, which makes sense to me, because people associate that with food safety. That makes them a little more nervous, and they’re more likely to throw out a greater percentage of that food.
For my presentation in the UK, I’ll give more specific results. A noteworthy one: The label ‘use by’ on salads had the greatest effect across the three categories on food waste. When participants saw ‘use by’ on salads the cost of discarded food was about 80 cents, compared to yogurt at about 50 cents.
Q: Did you examine how often in the real world ‘use by’ is put on salads compared to on yogurt or cereal, or these other labels you tested? It could be interesting to see how much a certain label is used in the produce department, for instance…
A: That’s a very good question. That’s something we are pulling together. Which categories are more or less likely to use certain words? What we can say is we found products in all three categories with different brands using all these labels. The majority of salads we saw in Ithaca, NY, used some language close to ‘best buy’, but we did see instances of ‘use by’, and ‘sell by’, although not ‘fresh by’. We put ‘fresh by’ in our experiment for fun, to test this food quality hypothesis. “Fresh by’ language you’ll see sometimes in the fresh juice category, but it’s less common terminology. There also wasn’t any consistency in labeling in terms of package format between bagged salads and clamshells.
Q: Did you consider altering the quality in packages of lettuce, but using the same label to see if the quality of product made more of a difference than the label? If some of the lettuce leaves looked brown in a package with a better ‘use by’ date than another package where the quality looked perfect…
A: Visual cues would be an interesting experiment, if we offered lettuce with the same date label, but altered the quality. You do find quite a bit of differentiation in quality between packaged greens even when it has the same date. It would be a good category to examine in this way. Another would be meat. We’ve thought about that, but haven’t gotten to it yet.
The other issue is the effect of package size. When we split it up between the small package sizes and the large package sizes, on average the cost of discarded product was 60 cents. It went up to 80 cents for the larger sizes and went down to 40 cents with the smaller sizes. Perhaps obvious, but here we’re trying to quantify that. I don’t think it’s necessarily obvious that the cost of discarded food was twice as much between the larger and smaller sizes. The same thing holds, regardless if it’s a small package or a large package, the biggest cost of discarded food is with the ‘use by’ label and the smallest cost is with the ‘sell by’ label. Those differences are smaller in the small sizes and larger in the large package sizes.
Q: Has your research changed your mind in any way regarding regulations on food labeling?
A: When I first went into the study, I didn’t think harmonizing this kind of labeling was a good idea. Now I’m starting to wonder if there are some merits to a policy that regulates these words.
Q: But then there’s the issue of who decides the parameters for the actual ‘use by’ date, and how that could differ based on different commodities, packaging technologies, and numerous other variables impacting shelf-life, etc.
A: And something else…how people respond to the actual date of expiration. I think that merits more work, fine tuning to see if it makes a difference if the expiration date is a couple of days away. What we did learn, when the product expiration was a week or two weeks out it didn’t seem to be as big of an effect as the words that went along with it. I went into this research thinking the date label wasn’t going to make much of a difference. Our results proved otherwise. Especially the impact that ‘use by’ and ‘sell by’ labels had on people’s thinking about food consumption.
It’s interesting to note, I was a little surprised that nearly all consumers, when asked, how much do you think your household will consume, they said a number less than 100 percent. They go into the supermarket to buy a product because of the value but right at the point of purchase, they already know they’re going to be wasting food. That was an eye-opening finding.
The last thing I’d say, is that I recently was at the USDA for a conference, and they actually have a poster hanging in the cafeteria from the World War 1 era, with six points about food: buy with thought, cook with care, use less wheat and meat, buy local foods, serve just enough, and use what is left. And at the bottom of the poster in bigger font it says, don’t waste it. I sit in my office thinking I’m doing something novel. And then I see a poster 100 years old and people are thinking about the same things as we are today, so I don’t know how far we’ve come. I guess it just means there are a lot of unanswered questions that require more study.
Doing this presentation in London is interesting… as when Tesco came to the US as Fresh & Easy, two of the issues it encountered were relevant to this discussion.
First, it required almost all fresh produce to be packaged before sale, so a consumer could not buy just one plum, say, but would need to buy an eggshell-type plastic package of four plums. This packaging of items that in America are typically sold bulk brought Tesco much criticism, especially as Tesco was also trying to portray itself as particularly green. Now this study brings to mind another thought: By selling pre-packed produce, was Tesco also compelling consumers to buy more than they would have preferred and thus increasing food waste?
Second, whereas in America only certain produce items, such as bagged salads, carry expire or best-by dates, Tesco insisted on placing a date on all fresh produce. This caused great confusion among consumers as nobody could figure out what this date meant on, say, an apple. Was it dangerous to eat after that date? Would it not taste good? Nobody knew, and it seems likely it depressed sales and increased in store shrink.
The issue of giving these labels meaning will be an interesting one to discuss.
Also crucial is this concept that the world ought to aim for zero food waste. At every stage of the supply chain, this makes no sense.
Start with harvesting…a field may hold, say, a million bell peppers, but the goal is not to harvest a million peppers. There is a cost every time a field is harvested. To do extra pickings, which don’t return financially, is to waste valuable resources, such as labor. Avoiding food waste may be important, but it is not obviously more important than avoiding waste of money — which, after all, we could use to buy food if desired!
Equally, at retail the goal is not to zero out waste. We already know that if you incentivize produce managers on shrink reduction — in other words to reduce waste — they can do this. How? They order bananas green, they reduce the assortment so that all those interesting items that attract consumers to the department are no longer on display, and they order lower quantities and accept more out-of-stocks. The goal, though, is actually to maximize sales and profits, not to minimize waste.
And consumers want to maximize their happiness. Accepting that there will be waste allows consumers to stock up on the fresh foods they love, even though the vicissitudes of life mean they know they are buying product they may wind up not needing.
Contrary to what seems to be an implicit assumption — if all households decided to reduce their purchases to move to a zero-waste goal, these households would buy less produce — that does not mean that the poor will have more food.
This food is grown for customers who can buy it. If those customers want to buy less, less will be grown, and the impact on the poor will be non-existent except beyond the very shortest term.
Join us at The London Produce Show and Conference to hear Professor Rickard and participate in this important conversation.
You can register for the event here.
Book hotel rooms here.
And review the website here.