True Cost of Food Loss and Waste Likely 25-50% Higher Than Generally Thought and Poised to Increase, According to The CGF & AlixPartners Report

NEW YORK (June 13, 2024) – The hidden costs of food loss and waste (FLW) – estimated to account for 10% of global greenhouse gas emissions – are likely far higher than historic measures, according to a new report jointly published by The Consumer Goods Forum and AlixPartners, the global consulting firm. 

The new report, titled Driving Emissions Down and Profit Up by Reducing Food Waste, is based on data form 16 members of The CGF Food Waste Coalition, which provides benchmarks for manufacturers and retailers. While the accepted ballpark figure for the value of FLW is $1 trillion, this new analysis finds actual food waste and surplus is likely 25%-50% higher than current estimates. 

Efforts to curb FLW are under-resourced, the study finds, and the future cost of GHG emissions could be anywhere from 3-to-5 times higher by 2050. This increase is partially driven by stricter reporting requirements and emissions caps expected to be implemented by municipalities, regions, and countries around the world. 

“Business leaders are aware that the cost of emissions are set to grow steeply, but our research shows that – even at the leading edge – the entire scope of food loss and waste is only partially captured in reporting,” said Andy Searle, partner, managing director, and EMEA leader for the AlixPartners Consumer Products practice. “The implied cost benefit of action on this front shifts the calculus for the industry.”

The coalition reported 2.1 million tons of food waste and additional 1.9 million tons of surplus in 2021, the study found. That translates to an estimated hidden financial impact of $10 billion for the 16 coalition members alone. Of that, $9 billion of the impact is attributed to productivity losses and $1 billion to carbon value. 

“Tackling food loss and waste is crucial from a net zero and P&L standpoint – fully accounting for the hidden costs – will materially improve the business case for change,” said Randy Burt, partner and managing director in the AlixPartners Consumer Products practice. 

The report, which includes FLW Capability Assessment tools for business leaders, outlines a gameplan for action. Leaders in the CPG and retail industries should be quantifying the full GHG impacts of FLW along with the toll it takes on profit & loss. A more realistic and comprehensive report of all types of loss will drive increased prioritization and investment in this critical area, the report said, and push companies closer to meeting sustainability and financial goals. 

About AlixPartners

AlixPartners is a results-driven global consulting firm that specializes in helping businesses successfully address their most complex and critical challenges. Our clients include companies, corporate boards, law firms, investment banks, private equity firms, and others. Founded in 1981, AlixPartners is headquartered in New York and has offices in more than 20 cities around the world. For more information, visit www.alixpartners.com.

About The Consumer Goods Forum

The Consumer Goods Forum (CGF) is the only CEO-led organisation that represents both manufacturers and retailers globally. It brings together senior leaders from more than 400 retailers, manufacturers and other stakeholders across 70 countries. The CGF accelerates change through eight Coalitions of Action: forests, human rights, plastics, healthier lives, food waste, food safety, supply chains and product data. Its member companies have combined sales of EUR 4.6 trillion and directly employ nearly 10 million people, with a further 90 million related jobs estimated along the value chain. It is governed by its Board of Directors, which comprises more than 55 manufacturer and retailer CEOs. For more information, please visit: theconsumergoodsforum.com

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