GreenPrice Supermarket 绿惜超级市场 ∗ Hong Kong

Source: GreenPrice Website 
GreenPrice Supermarket
绿惜超级市场

Reduces food waste and the pollution it generates, and combats against cost of living by selling groceries at affordable prices, that are normally wasted due to misunderstanding the Best Before Date label.

Hong Kong, China

Website
Terence Hon, Founder of GreenPrice
Photo by: Emilia Szekely
Best before date
Photo by: Emilia Szekely

GREENPRICE rescues edible foods about to be discarded due to marketing strategies and gives them one more opportunity of distribution in their online and offline stores — reducing food waste and the pollution it generates, and offering the possibility of reducing expenses for an important sector of the population.

Context

Approximately 3200 tons of food are wasted daily in Hong Kong. 29 of them are edible foods thrown out due to the lack of clarity in the labeling of supermarket products —in 2014, about 150 million food products that were fine for consumption were wasted!.

In addition to an ethical tragedy (29 tons of food could feed around 40,000 families), this waste saturates the waste dumps of the city and generates environmental pollution.

Although much of the food is in good condition, retailers and distributors remove it from the sideboards and discard it 6 months before their best before date arrives. They know consumers confuse that date with the use by date, and will not buy them.

The best before date is a label that is given to several products to indicate the moment when their quality is at its maximum potential (the moment when potato chips have their most crunchy consistency, for example), which does not mean that after that date the product is not fine or safe to eat, as has been corroborated by several investigations.

On the other hand, some products also (or instead) carry labels with the use by date, which is the one that indicates the moment from which the product should no longer be consumed to avoid putting the consumer’s health at risk.

Between the best before and the use by dates there is an important gap in which the products can be consumed without any risk. However, many customers do not understand the difference between the meaning of one and another label and, to avoid problems, try not to buy products whose best before or use by dates are close. Knowing this, the supermarkets (distributors) return the products consigned to the suppliers months before the arrival of their best before date, to keep their image clean.

As suppliers find it difficult to reposition these products, and storage is expensive, they discard them. This causes them losses of around HK$ 156 million each year — which soon will be bigger because a law in Hong Kong is about to be approved in which they will be charged for the disposal of waste.

Proposal

GreenPrice buys products whose best before date has not exceeded 2 months at a reduced price from the distributors or suppliers, or obtaining them in concession or as a donation. Their packaging, smell, taste, quality are strictly reviewed; and they are sold at prices 30-40% lower than the market through an online supermarket (with home delivery to facilitate the process to customers) and through fairs in neighborhoods, universities and corporate and environmental events (to bring them closer to potential consumers). This creates another step in the food supply chain that aids the best use of food.

This scheme benefits everyone because of the contribution it makes to reduce the environmental impact. Moreover, it benefits:

• GreenPrice, because it generates profits as a company that allow it to ensure the financial sustainability of the project — unlike if they were constituted as a non-governmental organization.

• Customers, because it allows them to access products that would otherwise be out of their reach, while contributing, in principle, to solving the ethical and environmental problems that GreenPrice addresses.

Here it is important to mention that the niche population of the project are middle-class citizens, especially adults. Firstly, the civil organizations that collect and redistribute food waste in Hong Kong — from restaurants and not from distributors or suppliers — focus on the poorest populations and the wealthier sector is not particularly interested in getting their products at a lower price. Second, because the type of products that GreenPrice focuses on are not essential— they are foods that are normally considered to be luxury and some other products such as cosmetics. Third, because young people do not seem to care too much about the high price of products.

• Suppliers. It represents their only alternative to garbage dumps, to channel their products with dates close to expiration in a responsible manner, minimizing their monetary losses due to transportation, storage and disposal of these products. — the GreenPrice initiative does not represent a risk for them because the project is still small and because the products it sells are not fixed, but depend on what suppliers provide.

In addition, some suppliers register their transfer of products to GreenPrice as part of their Corporate Social Responsibility (CSR) programs. Moreover, the sale of these products through GreenPrice allows them to access a population niche that will potentially continue to buy these products through conventional means.

The success of this proposal has been reflected in the fast growth of the project, which in just one year has managed to attract significant investment (especially from the SIE Fund in 2016), attract suppliers, start a supermarket and multiply its physical stores.

The company was created in 2016 by business students at the University of Hong Kong — now 5 or 6 of them plus vendors. Inspired by similar initiatives that operate in the United States, England and other countries, they collaborate with companies and universities to develop their model and fulfill their mission to raise awareness among citizens about the misunderstanding that exists with the best before date labeling, ensuring a more efficient and ethical use of food resources (and less waste), and reducing the ecological impact that their production and waste generate.

It does this by selling products at low cost, which its members believe will help accelerate the impact of the government campaigns to clarify the meaning of the labels for the public, because so far the main attraction for people seems to be the low cost of the products.

When people see that they sell products on which best before date has already passed, they begin to change their habits. This is how we support and accelerate the government’s educational campaign”, argues one of the creators of GreenPrice. For him, the government should prohibit suppliers from throwing away products whose expiration date has not yet arrived. But the government is slow, and it is that margin of time, in what the rules change, what GreenPrice uses to boost its project, giving consumers an alternative.

To extend the impact of the initiative in terms of raising awareness about the importance of consuming products in an ethical, environmental and socially responsible manner, GreenPrice also teaches courses in schools, companies and community centers (inside and outside of Hong Kong) and shares information through its WebFacebook and Instagram platforms.

At some point, the organization explored the possibility of channeling part of its products to disadvantaged populations, through donations, but couldn’t find a way to do this in a financially sustainable manner. Today, they give to the needy less than 5% of their earnings in food that has passed 1.5 months after their best before date and that they realize that it is no longer going to be sold.

Following the English criteria to be recognized as a social enterprise (even if this modality of business is not officially recognized in Hong Kong), GreenPrice re-invests 70% of its profits in the growth of its initiative.

Future Steps

Currently, GreenPrice: