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Optimising resources in food grocery value chains WRAP Conference Creating the Future: Rising to the Resource Challenge Judith Batchelar Director Sainsburys Brand 5th November 2015
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Agenda
Our context
Underpinning our work
Product Designing in Sustainability
Understanding & helping our customers
Within our own operations
What does the future hold
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Our context
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The global challenge
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A complex set of evolving challenges
Agricultural land use change:
11% of global GHG emissions
Severe flooding:
will double in Europe by 2050
Land availability:
50% of available land mass used
to grow food
Global Fish Stocks:
>85% over or fully exploited, or in decline
Resource availability
Extreme drought events per 100 years
will double (IPCC)
Agriecosystems:
60% degraded
Stable & predictable
climate
Global Food
Reserves 50 year low
Global GHG emissions: 24% from agriculture
Decreasing
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A complex set of evolving challenges
Food waste: 1.3 billion
tonnes a year Demand for
resources and food
Middle class
consumption 3-4 billion by 2050
Global population: 2-2.5 billion
by 2050
Food: 50% by 2030
UN FAO
Food Prices (104%) & Price
Volatility (>3-fold)
UK Population: 10M more people in 20 years
UK: Products & services =
75% of personal CFP
Food Poverty: 4.7 million
people in UK
Competition for Water:
30% by 2030 IFPRI
50 billion cost of poor diets to
NHS by 2050
Energy Demand: 50% by 2030 (IEA)
Ill Heath: circa 1bn stuffed or starved
Increasing
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A UK Retailer but a global business
10Billion of Sainsburys Brand products from 72 countries
Over 1,300 Stores Over 160,000 Colleagues Over 2,000 supplier sites
10,000s farmers CANADA
USA
USA
MEXICO
PANAMA
DOMINICAN REPUBLIC
ST LUCIA
COLUMBIA
BRAZIL PERU
BOLIVIA
CHILE
EUROPE
UK EIR
E
SPAIN
SENEGAL
NORWAY
SWEDEN
FINLAND
TURKEY
EGYPT
PORTUGAL
GHANA
MOROCCO
KENYA
SOUTH AFRICA
MADAGASCAR
MAURITUS NAMIBIA
MALDIVES
INDIA
CHINA
AUSTRALIA NEW ZEALAND
MALAYSIA
SOUTH KOREA
VIETNAM
THAILAND
PAKISTAN
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Underpinning our work
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An End to End Approach Because we dont work in isolation, we need to understand this for the entire value chain
Soil Landfill
Progress going forward will rely on our ability to join up the end to end value chain to create truly sustainable business models
Food and Drink Manufacturing
and Processing
Agriculture and Land Use
Retail Operations
Supply Chain and Logistics Consumers
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Best Suppliers
Best People
Best Data
Fit For the Future Best people with the best information make the best decisions working with the Best Suppliers to create shared value
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Databenchmarking & best practice
Sustainability standards
Key raw materials
Hotspot issues, (triple bottom line)
Building on from and using existing standards
Standard assessment & simultaneous data capture
Supports benchmarking & continuous improvement.
Improves transparency & traceability within our supply chains.
Produces real time value chain data for all stakeholders more than just certification
Technology opportunities form remote sensing to big data generating foresight
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Product
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Designing in Sustainability
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Understanding & helping our customers
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Structural change in the UK grocery sector
Grocery Market Channel Share, 2013-2022: % Take Home Market
2013 2022 Forecast
Online
Convenience
Supermarket
Discount
Chart1
69.89040447184.884677231321.17018630044.0547319965
57.575737282611.038539371123.53878543977.8469379066
Sheet1
6,989%5,758%
488%1,104%
2,117%2,354%
405%785%
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There is real structural change in channels fragmenting the customer shop
Market Value by Channel: bn
Supermarkets Discount
Convenience Online
2015 2013 2014 2016 2021 2018 2017 2020 2019 2022
+10%
2015 2013 2014 2016 2021 2018 2017 2020 2019 2022
+4%
2015 2013 2014 2016 2021 2018 2017 2020 2019 2022
+12%
2015 2013 2014 2016 2021 2018 2017 2020 2019 2022
0%
Chart1
6.7920139016
7.6192215267
8.5388528347
9.5088224303
10.5256700084
11.6270651831
12.7904779123
14.0247714499
15.2206371618
16.4675233634
Sheet1
78910111213141516
Chart1
35.4618257821
36.7684812117
38.1885563753
39.6167067673
41.0329055029
42.5961642805
44.2125975797
45.8837468586
47.6111877078
49.3983135569
Sheet1
35373840414344464849
Chart1
8.1822413143
9.7845634458
11.4851322868
13.1829130134
14.7642891344
16.3889660543
17.9757018477
19.5914225901
21.3303713717
23.1653935782
Sheet1
8101113151618202123
Chart1
117.0722501941
116.8591885178
116.5947207657
116.244936253
115.86532565
116.0727441265
117.2470461019
118.4322380369
119.6457900298
120.8279981497
Sheet1
117117117116116116117118120121
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Im currently drinking Taste The Difference Prosecco
I am 13 and I hate supermarkets unless Im taking pictures of myself there
The kids are sharing with Grandma in Australia that they love Sainsburys new lasagne
I am a google employee who likes electronic shelf edge labels
I want a job running product tests at Sainsburys
Watch me as I review my shopping
I like Sainsburys
In Godalming store we are talking about British Strawberries
Here is a vintage picture of me eating strawberries
4,000 customers are on a permanent forum with chat rooms and a weekly feedback survey
Here is a collection of pictures and recipes
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Closer to customers
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Helping customers reduce their household waste and start saving money along the way
Planning e.g. shopping planning not meal planning
Shopping e.g. navigating multi-buys & till shock
Cooking e.g. portion size
Storing e.g. confusion over what to put, where
Not using e.g. unopened products as well as leftovers
Throwing out e.g. battling the bins & recycling
PLANNING SHOPPING
COOKING STORAGE
NOT USING FOOD
THROWING OUT FOOD
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Waste Less, Save More: Search for a town
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Within our own operations
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Everything you would expect and a lot more
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Our Waste and Recycling Creating Renewable Energy :
First store ever to be powered off grid by food
waste
AD Plant
Sainsburys Cannock
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What does the future hold?
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Sainsburys Brand - Research Portfolio
Duration: 6m 4years
Format: Farmer-Grower Supplier-Academic-Sainsburys
3.5m per year
64 projects
30 research institutions
40 suppliers
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Fresher better quality products with better availability - Container Tracking
Real time location data
Temperature and MAP monitoring
Proof of concept funded by the Catapult
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Technology enabled
Managing interdependencies Trade offs
Data translated into information and
insight Real time
Foresight, modelling replaces
hindsight
Complex agendas require an interdisciplinary approach
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Partnership and collaborations
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Evolving our relationship with WRAP
Working together for over 10 years Valued independent source of knowledge, data, benchmarking and insight Facilitating value chain and pre-competitive stakeholder activity Moving from a packaging focus, to food waste & packaging to resource efficiency
& resilience
Slide Number 1AgendaOur contextThe global challengeA complex set of evolving challengesA complex set of evolving challengesA UK Retailer but a global business Underpinning our workAn End to End ApproachBecause we dont work in isolation, we need to understand this for the entire value chainFit For the FutureBest people with the best information make the best decisions working with the Best Suppliers to create shared valueDatabenchmarking & best practiceProductDesigning in SustainabilityUnderstanding & helping our customersStructural change in the UK grocery sectorThere is real structural change in channels fragmenting the customer shopSlide Number 17Closer to customersHelping customers reduce their household waste and start saving money along the wayWaste Less, Save More: Search for a townWithin our own operationsEverything you would expect and a lot moreOur Waste and Recycling Creating Renewable Energy :What does the future hold?Sainsburys Brand - Research PortfolioFresher better quality products with better availability - Container TrackingComplex agendas require an interdisciplinary approachPartnership and collaborationsEvolving our relationship with WRAP