Rising utility costs, changing legislation and the increasing environmental awareness of consumers all present challenges for the baking industry. But these issues could equally be viewed as opportunities for businesses to create competitive advantages.
Consumer demand for ’greener’ food, for example, has been estimated to add an additional £16.35 to the average weekly shopping basket, with spending on ’sustainable’ foods set to top £20bn a year.
In the course of researching this article, two things became very clear. Firstly, the baking industry and its supply chain recognise the pressures to work in a greener, more environmentally friendly way, harnessed to responsible corporate and social practices, and are keen to take action.
Secondly, there is a huge amount of confusion about how to make a start, where to find help, what impact this will have on individual firms and whether it will be of any business benefit.
"Many bakeries are spending thousands of pounds on wasted energy, while needlessly emitting hundreds of tonnes of carbon into the atmosphere," says Hugh Jones, a senior account manager at the Carbon Trust. "As the effects of climate change become increasingly apparent, the need for businesses in this sector to take steps to cut carbon emissions, the main cause of climate change, has never been greater. Taking action to reduce energy-use can benefit an organisation’s bottom line, as well as the environment. For help with improving energy efficiency, talk to us. We can help companies leverage the business opportunity that climate change presents."
Despite the confusion surrounding green issues and how to react, some bakeries have already begun working corporate social responsibility (CSR) into their business structures.
Michele Young, retail and brands director at BB’s Coffee and Muffins, sums up the current state of play for many companies: "We are in the process of formulating our policy and establishing where we can become more environmentally compliant. We are working with our suppliers to identify our environmental impact, but as this is a very complex area, we don’t want to rush into making easy but ineffectual claims," she says.
Some companies in the food sector, such as Waitrose, Brakes and Greggs, have already published environmental/CSR policies and materials. Jess Hughes, Waitrose’s corporate press officer, explains its approach: "We have developed a long-term CSR strategy, which is at the heart of our business and is outlined in our ’constitution’. Our ongoing work includes reducing packaging weight, relative to sales, by 33% since 2000."
Meanwhile, Tesco has recently announced a £25m research initiative looking into sustainable retailing practices. This includes the prospect of market gardens on supermarket roofs and investigating the conversion of poultry feathers into a form of packaging.
Carbon footprints and controlling carbon emissions are leading the environmental debate. Some consumer products, such as Walkers crisps, are now carrying carbon footprint statements alongside ingredients listings and nutritional information. But how do you work out your carbon footprint?
The Carbon Trust provides a good starting point with a free guide on the topic. This provides an explanation of key footprinting concepts, a definition of the term ’carbon footprint’ and an overview of the key issues in calculating carbon impact.
The Carbon Trust is an independent company, set up by the government, to provide free advice to companies on reducing their carbon footprints and energy consumption. It also provides information on free energy surveys and design advice for smaller businesses, and offers larger companies a carbon management service. It can provide information on tax breaks and interest-free loans for capital equipment that reduces energy usage. The Trust also makes grants - in some cases sums in excess of £150,000 - towards new technology that will contribute towards a greener business.
As previously reported in British Baker, Brakes, a leading foodservice distributor, is working towards accreditation to ISO14001, the international standard for environmental performance, in conjunction with the Carbon Trust, by recycling and reducing packaging on products and by reusing water in a circulation system for washing vehicles.
Beyond carbon footprints, Envirowise, another government-funded organisation, offers support to the food and drink industry and hospitality sector to become more resource-efficient, reduce environmental impact and increase profits.
It offers over 700 publications, a free advice line and access to free expert consultancy designed to help identify sources of waste and enable businesses to start making immediate savings.
"Businesses consider many ways to cut costs before they consider waste. However this is an area that they can transform profitably, based on some relatively low-cost, pain-free measures," Martin Gibson, Envirowise’s chief project officer. "Issues such as excessive water use, the creation of unnecessary waste and ignorance of regulations can have a huge impact on profitability. Instead of throwing money down the drain, businesses could build brighter futures, by reinvesting savings realised through better environmental practices on staff and product development."
A good example is provided by R Mathieson & Sons, a firm of fifth-generation master bakers founded in 1872. The company has a retail estate of 26 shops in eastern central Scotland and seven shopping centre-based coffee shops, stretching from Elgin to Gretna. "Our approach has been very much on the basis that, in most cases, good environmental practice is also good business sense," says MD George Stevenson.
Working with Envirowise, the company implemented a structured programme of progressive waste minimisation. The key to success lay in the involvement of employee teams across the business, which helped identify areas for improvement.
The programme brought significant benefits, including a 66% reduction in waste disposal costs, saving £12,000 a year, savings of £3,700 a year on minimising wastage of bakery products and frying oil, decreased consumption of raw materials, water and energy, and a reduction of around 20% of the waste the company sent to landfill, at 31 tonnes each year.
Some of the biggest savings came from outside the production area. Better scheduling of deliveries led to savings of around 30% in delivery miles and almost £30,000 in fuel and vehicle costs.
The project, and the way waste minimisation training was incorporated into Mathieson’s induction programme for all new staff, also earned the company a Scottish Enterprise Forth Valley Best Green Business award, and the accolade of Enterprising Scotland’s Best Business in the Community award.
"The considerable savings we made through the Envirowise programme meant that when we moved to our purpose-designed new premises in 2006, we were able to make use of all that we had learned and kept environmental considerations to the forefront of the design, planning and operations at the new site," says Mathieson.
Green values are also woven into the fabric of Macphie, the independent food ingredients manufacturer based in Glenbervie in the north-east of Scotland.
The company has an environmental manager and all of its manufacturing sites operate to the ISO 14001 standard. In 2000, it invested £500,000 in its third effluent water treatment plant. A by-product of this process is sludge, which is recycled on the estate where the company is based as a fertiliser.
Every year, Macphie plants 30,000 trees on
=== Counting the cost ===
According to Envirowise, the food and drink sector in the UK uses 440 million cubic metres of water, produces 12.6 million tonnes of waste, and gives rise to 12.4 million tonnes of CO2 emissions from energy use each year. The annual cost of waste disposal in the UK has risen to £500m, with seven tonnes of waste produced per person in the UK, four of which go straight to landfill.