Following rising food waste levels, M&S is due to roll out a new supply chain system across its store estate in 2020.
The new system, called ‘Vanguard’, has been introduced last year as a trial, while being in 90 stores now, and is expected to tackle food waste issues and its associated costs.
Although food revenues in the weeks leading to Christmas have been up, “disappointing” food waste levels have been registered, hence helping to keep forecast full-year margins at the lower end of guidance, according to M&S CEO Steve Row.
He commented: “Our supply chain in clothing, home and food is a little bit clunky and a little bit expensive. The Vanguard project is essentially about speeding up the supply chain, lowering stock levels everywhere across the supply chain and making sure we have more efficiency, better availability and lower costs and lower waste. And we’re in the process of rolling it out.”
Mr Rowe has also pointed out the impact of the disappointing Christmas waste on stock levels in some categories. He adds: “We bought more than we sold. It’s basically the net of what we bought and what we sold.”
According to the retailer, ‘Vanguard’ has reduced, during its trial, food waste by 30%. New practices, which were defined in an investors’ presentation back in October, have been introduced, including raising the number of deliveries to stores out of hours. Deliveries of ambient products to stores now take place seven days a week, instead of four or five. Along this line, frequent, smaller deliveries from suppliers to depots have been introduced.
Mr Rowe said also that in spite of the waste levels, “the most important thing is that customers reacted strongly to the offer and we’ve got momentum in the food business and we continue to improve our performance and gain market share.” He also added that all the surplus food has been redistributed to charities.
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