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Sustainable Foodservice: Business Incentives for Going Green

Aug.27.2015
09:36:02 AM

sustainable-foodserviceToday’s foodservice landscape is always evolving. One of the ideas that the foodservice industry has begun to accept and incorporate into operations over the last few years has been sustainability.

As we’ve previously discussed on the CHD Expert blog, today’s consumers care about how the food they eat was sourced and prepared. Sustainability has become standard in foodservice.

While this trend seems like a recent buzzword, a discussion published in Yale Insights showed that in 2010, 68 percent of people said they were more willing to buy from responsible companies that work to ensure that they cause the least amount of harm when creating their products. In 2008 that number was 56 percent, which shows that as time progresses and Americans become more conscious and critical of company practices, issues such as sustainability become more important to them when they buy.

One recent example of a foodservice company maintaining its principles of sustainability and ethical practices came when fast casual chain Chipotle Mexican Grill stopped serving carnitas in more than one-third of their restaurants. The chain’s animal welfare auditors discovered that one of their suppliers was violating the brand’s animal welfare standards and they stopped purchasing from that supplier. There are few farmers that raise animals in a way that meets Chipotle’s requirements, which can make it difficult for them to source products. (According to CHD Expert’s Easy2FIND foodservice database, there are over 1,800 Chipotle units as of August 2015.)

In a February 2015 earnings call, Chipotle founder and CEO Steve Ells estimated that the decision to pause the sale of carnitas could cost the company $2 million in sales, but also said he didn’t think it would hurt the company in the long run.

Not all foodservice brands and operators follow Chipotle’s extreme example, but many do make an effort to ensure sustainable foodservice practices.

Foodservice operators across the nation have adopted sustainable practices, such as water, energy, and waste management. These operators have found that not only is sustainability good for the environment, it can also be good for the bottom line. For example, a $1 reduction in energy costs equals $12.50 in sales at an 8% profit margin.

In addition to operational sustainability, foodservice operators are also paying more attention to how food and products arrive at their establishments. Sustainable packaging, such as compostable or recyclable disposables, have gained favor in recent years. Some operators have also applied these principles in their own businesses, by switching to environment-friendly materials and encouraging customers to use reusable products such as mugs and bags.

While much progress has been made with regard to sustainability, there is still plenty of room for growth. As more operators experience the longer-lasting benefits of sustainable foodservice, new waves of operators will join them in incorporating sustainable practices into their operations.

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