Moving Boundaries

A Ladle … Selling Instead of Throwing Away

The industry is constantly being moved by new trends – we track them down. In our series 'A Ladle …' we regularly present exciting projects and personalities from the food and gastronomy scene. Today in a 3-question interview: Oded Omer, Co-Founder and CEO of Wasteless. The Israeli start-up prices food items using a dynamic algorithm based on their best-before date.

How does smart pricing help not only the environment but also restaurateurs?

Food is bountiful on the METRO shelves. But for any given product, some items may have a shelf life that is slightly shorter than others have. Every single item on the shelf is fresh, healthy and tasty, but given the competition between these expiration dates, the food that has a slightly shorter shelf life runs the risk of expiring on the shelf and being wasted. All the efforts, the water, energy and love that have gone into that food will have been for naught. With smart pricing, that older item is marked down optimally to encourage restaurateurs to purchase it, so they spend less for perfectly fresh, healthy food. Restaurant owners usually have a pretty precise picture of when they turn over their fresh stock, so we are giving them tools and incentives that make sense, boost their profits and help the environment by cutting down on waste. Many restaurateurs have a higher-than-normal awareness of their place in the supply chain in terms of expenses, profits, waste and environmental impact. I don’t know a single restaurateur that wouldn’t jump at the chance to serve perfectly fresh food and also increase their margins. This way, METRO eases several of their pain points.

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How does Wasteless fight the perception that the quality of ‘older’ products is lower?

Wasteless flips the paradigm in a very subtle way. It can be difficult to explain, but it’s felt by the customer and it’s pretty easy to see on monthly earnings reports. Basically, Wasteless technology makes longer shelf life the premium, or the option, rather than the norm. Traditional ‘discounts’ don’t really work because discounts are usually communicated by slapping a sticker on something, or worse, putting the item in a ‘discount’ area of the store. This labelling and sequestering have a definite stigmatizing effect. The Wasteless system leaves items in their normal place and doesn’t put any new stickers on them. The prices are displayed in the normal spot, and markdowns are applied automatically and invisibly. At MAKRO, we will have in-store marketing to explain that this healthy, sustainable choice saves money and the planet. People are pleasantly surprised when they learn that this small change can have such a huge impact.

How do wholesale requirements of Wasteless differ from those of supermarkets?

I’d say that in wholesale, we have professional customers who are able to make an informed decision. Being trained in food planning, they know better than other consumers if the shelf life meets their requirements. And for them, a markdown is an immediate margin increase. Since they are shopping professionally, the decision has more of a financial component than in the case of a consumer. The wholesale customer will have a different set of guidelines that determine if they need to pay for extra shelf life, but the back end of the Wasteless system is flexible for any shopping environment. The AI studies actual customer behaviour and adapts to it – and that goes for any shopping environment, wholesale or supermarket.

About Wasteless

The technology used by Wasteless reduces the prices of goods according to their best-before date – the ‘older’ the product, the cheaper it becomes. The pricing is optimised using artificial intelligence (AI). Oded Omer, Co-Founder and CEO of Wasteless, considers their solution an evolution in inventory control systems. Following extensive testing, Wasteless technology will be integrated into METRO’s POS system in 2021. The new pricing system will first go live at selected MAKRO stores in Poland. A wider rollout of the AI-driven pricing technology is planned. Omer: ‘Most importantly, this is a huge win for the environment. There’s a lot of talk about sustainability in business, but it only really works if it’s also profitable.’ More about the cooperation between Wasteless and METRO.

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