What if you had to order your bread from a person every week?
March 25, 2010 8:52 PM   Subscribe

Why, at my job at a convenience store, am I throwing out 30-50 loaves of bread a week? Isn't there be a better way?

More specifically, would bread distribution via more localized bakeries be more efficient? I have this vision of bakeries localized enough to predict the bread demand better than the mass distribution system we now use.

Does this make any sense?

I would LOVE some numbers.
posted by Truthiness to Food & Drink (31 answers total) 1 user marked this as a favorite
Maybe the store is carrying too much inventory?
posted by itheearl at 8:55 PM on March 25, 2010

The question is, why is your store ordering 30-50 too many loaves a week. The question is how many loaves are you selling? If you can't query the pos to tell you how many loaves you're selling, at least you can have the cashiers manually tally the bread sales for a week or so to get an idea of volume. Not only is it wasteful in that people could be eating that bread, 30-50 loaves of bread takes up a lot of space.

The 7-11 by house may have 6 loaves on the shelf and I doubt much more in the back. I'll notice the mom & pop c-store across the street will often have a few loaves of Ralph's (regional supermarket chain) bread on the shelf when their regular bread is gone. In other words, they seem to prefer to order a smaller amount and if there's extra demand before their bread guy gets there, they'll have someone run to the grocery store and get some to tied them over until their bread guy comes back.
posted by birdherder at 9:03 PM on March 25, 2010

More specifically, would bread distribution via more localized bakeries be more efficient?

People like one-stop shopping.
posted by MesoFilter at 9:05 PM on March 25, 2010

It has a lot to do with the unwillingness of store owners letting their shelves go empty, abundance is the name of the game in shopping. So some of the bread is shipped knowing it will go unsold. 30-50 a week isn't really that bad, it seems like a lot all at once but I bet is small when expressed as a percentage of bread sold in that time frame.
I work for a smallish local bakery and one of the larger stores we deliver to told us to expect to pull 25% of bread off the shelves everyday (we only leave our bread on the shelves for one day) and base our delivery numbers on that (so, add 25% to the number of loaves that actually go to consumers). We don't exactly follow their directives, but it is pretty shocking the amount of bread that goes unsold.
That said, unless it's moldy, there are plenty of places that could use the bread, it should never be thrown away.
posted by Stonestock Relentless at 9:06 PM on March 25, 2010

Possibly the store has a minimum order from the distributor. Or gets the bread so cheaply that, after the retail markup, discarding dozens of loaves a week hardly makes a dent in the bottom line. And while some people will stop by a convenience store in a pinch just to buy bread, I'd wager that the store hardly sells enough to make any other supply scheme worth its while.
posted by contessa at 9:07 PM on March 25, 2010

I'm with itheearl, it sounds like you have too much inventory or charging too much for it or your customers aren't aware of all the bread you have.

You could keep track of your bread sales through the year and alter your ordering as appropriate. That coupled with shoring up relationships with bakeries that would allow for rapid ordering/delivering when there was greater than average bread sales could save you money and waste less.

Keep in mind of course that all of this metric gathering, analysis and action for all of your perishable goods could take a lot of effort to keep running.
posted by mmascolino at 9:07 PM on March 25, 2010

I apologize if I'm off topic here.

If you can, donate that bread to your local homeless shelter, church or other charitable organization. There are plenty of places that could use that bread to feed people.
posted by Wanderer7 at 9:10 PM on March 25, 2010 [9 favorites]

A friend of mine works at a small bakery in Vermont. They sell bread directly, and also through many grocery stores throughout the region. When selling through grocery stores, it is up to the bakery to decide how many loaves of which type to leave. For many years that had a terrible time figuring this out. They'd sell out of one item and have lots of another item left. Try as they might, they couldn't get the lossage down.

Then they bought some software, I believe from a company in Australia. Initially it just monitored their sales and lossage at each outlet. Then it started making recommendations. My friend said it was amazing. It made recommendations that made no apparent sense, but which worked in practice. One week it would tell them to bring extra Rye to this store, another week it would tell them to skimp on the french bread at another store. Sales shot up, takebacks went way, way down.

I'll see if I can get the name of the software. It's not easy to guess how much bread of which type to put on a shelf just by eyeballing it. But it is possible to do better than the OP's store is doing.
posted by alms at 9:11 PM on March 25, 2010 [8 favorites]

(I guess I have no idea the size of your store and maybe 30-50 loaves is really high, in which case some is dropping the ball, the numbers can be fixed no matter what the distribution method is)
Also, the specific number of loaves sent to the store is more often then not decided by the bakery not the store, often bread is sold with a "buy back" model, where the retailer only pays for what sells and the baker has to eat the cost of the unsold goods, which puts all the pressure on the bakery to get the numbers right.
posted by Stonestock Relentless at 9:12 PM on March 25, 2010

That's a real shame. I used to work at a youth hostel, and we'd go down to the Starbucks every night to get their unsold baked goods and bring them back for the guests. Maybe there's a hostel or food pantry or homeless shelter near you that would pick up your bread? Even if you just put the bread *next to* the dumpster instead of in it, and let someone know it was there?
posted by acridrabbit at 9:13 PM on March 25, 2010

I've seen the Salvation Army visit stores to pick up day-old bread.
posted by Chocolate Pickle at 9:23 PM on March 25, 2010

I have heard more than once that supermarkets treat bread / eggs / milk as "draw" items to pull people into the shop, selling them at virtually no mark up, in order to get them to buy the other stuff that does have a high markup. the idea being that people NEED those items all the time, and you can reliably pull people in to get them especially if you're selling them cheap.

in which case, bread, being cheap as it is, ends up being treated as a sort of marketing / advertising expense (essentially). doesn't actually matter how many they actually sell so there isn't much pressure to get the numbers exactly right, only that you don't run out. in fact, the effects on the store of running out of an essential good like that is devastating - customers have especially made the trip to come to your store for those essentials, and if they cannot count on getting it there, they will not come again in the future.

after too much explanation, basically i'm just getting at the fact that running out of bread is far more costly than throwing a few dozen loaves out.
posted by xdvesper at 9:24 PM on March 25, 2010

A bit more info: I (used to) work here.

Almost all of the bread we sell is Stewart's brand bread, which is delivered in Stewart's palettes which are taken out of Stewart's trucks. And I have personally carried trash bags so heavy with bread I could barely carry them into the dumpster. Some stores do give out of code bread to City Missions and such, but this is becoming less common. Could different rules apply since the bread distribution is in house?

Then again, Stewart's might just be aggregating the deliveries of a great many bakers who use the rules described above. The 50-70 is out of approximately 150 loaves. Maybe eight palettes.
posted by Truthiness at 9:27 PM on March 25, 2010

It has a lot to do with the unwillingness of store owners letting their shelves go empty, abundance is the name of the game in shopping.

In my experience, this is exactly true. In retail, as in other industries, there is a lot of incompetence. I used to throw out 20 - 30 loaves of bread a night working in a grocery store. This was directly due to the manager ordering way, way, too much. He knew he was doing it, too, but he was, in his words, terrified of running out. (Note, we were never within ten miles of running out.) Bread was something that the higer-ups, if visiting, would be sure to look at. It's a staple. In his mind running out was much worse on him and his standing than throwing out a hundred loaves a week.

Of course, I don't know how your store deals with its bread ordering; it may all be computerized and be due to some very different kind of incompetence.

It's not true that no one in the company cares; right around the time I left the district began putting accountability logs into place to crack down on too much shrink in the bread and milk department -- you wrote down how much you threw out of what and that was made public knowledge to all the managers and assistants in the district. I sent in the first report accurately; the second one he sent in completely falsified.
posted by frobozz at 9:36 PM on March 25, 2010 [1 favorite]

More specifically, would bread distribution via more localized bakeries be more efficient?

Interesting question! I think that the answer is very likely to be no.

As a thought experiment, take this premise to an extreme: one bakery for each person or household. To be generous, we can even assume that fixed costs do not apply so there is no efficiency loss due to economies of scale.

Sometimes I eat very little bread, sometimes I eat a lot. Some days I want rice or potatoes with dinner, and sometimes I want bread instead. I often don't know my demand for bread myself until I'm hungry - in other words, small bakeries will still have a very difficult time predicting demand for bread.

If every tiny bakery has difficulty predicting demand, then that adds up to a large amount of waste just like you see at your convenience store. Probably about the same for efficiency... until we put fixed costs back into the model and the small bakeries become much less productive.
posted by ripley_ at 9:37 PM on March 25, 2010

Just as a note, it may not be possible to donate the bread directly, if you're tossing it because it's past its expiration date. If there are local ordinances against that, you could try seeing if you have a Food Not Bombs or similar org in your city. Some chapters get a lot of their food from dumpstering, and might appreciate an anonymous heads up on the weekly bread bounty.
posted by shaun uh at 9:52 PM on March 25, 2010

See if you have a food rescue in your city.
posted by acoutu at 9:59 PM on March 25, 2010

At Shell stations in Canada, the distributor pays a kickback to Shell for every item the store buys. The store owner eats the loss for spoilage and shoplifting, the supplier gets their full bill (those that don't accept returns, anyway, which most do) and shell gets a share of gross sales and the kickback. It's part of a system to find someone willing to take the loss (the owner) so Shell and the suppliers don't have to...

In your case, though, something seems amiss. Bread manufacturers usually buy the stuff back and refuse to deliver excess stock if they have to eat the loss. It may be that the delivery driver is simply an idiot or there's a business agreement that you don't know about.
posted by klanawa at 10:19 PM on March 25, 2010

Work with management to have this donated to a food bank or soup kitchen.

Apparently the bread excess inventory is very common because day-old bread is super common at food banks and soup kitchens.
posted by Jacqueline at 10:32 PM on March 25, 2010

The OP isn't asking what to do with the bread. He or she is asking why this happens.
posted by ripley_ at 10:54 PM on March 25, 2010

Chest freezer, get one used and find someplace to put it.

Take McDonalds for example, they need to order enough buns for a week, yet with a buffer to ensure they don't run-out. Where does it all go, into the walk-in freezer. Pull out what's needed a few hours ahead of time. Bread products thaw quickly. As long as it's not in there for weeks, you can have relatively fresh loaves without fear of running-out.
posted by hungrysquirrels at 11:24 PM on March 25, 2010

Your local Ronald McDonald house will also happily accept food donations.
posted by halogen at 11:43 PM on March 25, 2010

Then again, Stewart's might just be aggregating the deliveries of a great many bakers who use the rules described above. The 50-70 is out of approximately 150 loaves. Maybe eight palettes.

If you retail two types of bread (in equal quantities) and each is delivered in 18-loaf trays, then to order your 150 loaves (75 brown, 75 white) you'd need to order 5 trays of each - i.e. 90 loaves of each. So you'd be over-ordering by 15 loaves of each, a total of 30 loaves.
posted by Mike1024 at 1:29 AM on March 26, 2010

A lot of customers perceive that groceries are going to be priced higher at convenience stores than at grocery stores, so they won't buy things like bread or eggs at a convenience store (unless it's an emergency and the grocery stores are closed).
posted by Oriole Adams at 2:37 AM on March 26, 2010

Take McDonalds for example, they need to order enough buns for a week, yet with a buffer to ensure they don't run-out. Where does it all go, into the walk-in freezer. Pull out what's needed a few hours ahead of time. Bread products thaw quickly. As long as it's not in there for weeks, you can have relatively fresh loaves without fear of running-out.

Maybe it depends on the location. When I worked there in the 90s, buns were delivered 2 or three times a week (I forget- it might have been a once every three days thing). They expired after 5 days. Nobody froze buns because that reduced quality. Might be different in more rural areas?

A lot of places won't take food donations that are expired. And a lot of manufacturers prohibit their food from being donated if it is expired. They don't want people eating their brand of bread when it is no longer up to quality standards. And for other more dangerous foods, god help everyone if someone gets sick from eating expired food.
posted by gjc at 3:45 AM on March 26, 2010

More specifically, would bread distribution via more localized bakeries be more efficient?

In Central Asia it is done like this. Local bakeries every couple of blocks, and when you want bread you walk down and get one just being pulled out of the oven. Hot fresh bread!

Very little waste, because they are making it as it sells and there are never more than maybe 10 or so sitting out waiting to be sold.
posted by Meatbomb at 6:59 AM on March 26, 2010

More from my friend:
The company is called SSI and the name of the software is Globalbake. They are out of New Zealand. It would be software used by the bakery delivering the bread, not the store. The system requires that someone record the unsold 30 to 50 loaves and their varieties each week. If this represents four to seven tossed loaves a day, that isn't bad; if it is 30 to 50 in one day at the end of the week, realignment might indeed be in order. My guess is that the store in question is paying for the unsold bread, not the bakery. At our bakery, we have some accounts (the bigger ones) where we absorb the cost of unsold bread; at the smaller accounts, they absorb the loss. I did an analysis a few years back and saw that sales at our smaller/mid-sized accounts weren't growing at the same speed as the larger accounts, so we strategically switched a couple of stores that were on the margin with positive results. One question for the store is to see if it can switch to a guaranteed sale system.

One person spoke to the issue of abundance. The bakery now has a cafe and we have a higher "waste" target there than we do at the grocery store accounts. At the stores we are shooting for 13% and in the cafe it is a few points higher. We want to avoid the scenario of customer having no choice to make during our last couple of hours of business.

Would the public be better served by local bakeries, rather than national/regional bakeries? Good question! There is waste in both systems. Our waste is all sent to happy consumers -- food shelves and farmers. One dairy farmer says his cows LOVE our seeded baguettes! A local bakery is able to produce and deliver fresh and possibly handcrafted bread that is going to taste a whole lot better, and in many cases be better for you, than mass produced bread. I've been amazed by how much of an art artisan bread making is; it isn't easy to produce consistent quality naturally levained bread -- lots of variables such as temperature, humidity, batches of flour come in to play. What I see in Vermont is that there are a number of small bakeries only deliver two or three days a week, that puts a store in an awkward position of not having consistent supply. Our bakery delivers every day, and every loaf on our shelves was baked early that day and this is not easy to do; we used to be small, and in the universe of bakeries, we still are small... but we're a fairly sizeable artisan bakery now.
The GlobalBake website also includes a case study of the bakery in Vermont (pdf).
posted by alms at 9:45 AM on March 26, 2010 [2 favorites]

alms, thanks for getting this info, I'm a software developer with no interest in bread distribution but I found this very interesting
posted by exhilaration at 2:06 PM on March 26, 2010

More specifically, would bread distribution via more localized bakeries be more efficient? I have this vision of bakeries localized enough to predict the bread demand better than the mass distribution system we now use.

No. The law of large numbers applies here. Just like taking a survey, if you have a small sample size your results will be all over the place. If you have a very large sample size, your results will tend toward the mean because most of the "noise" cancels out. From the Wikipedia article,
It is important to remember that the LLN only applies (as the name indicates) when a large number of observations are considered. There is no principle that a small number of observations will converge to the expected value or that a streak of one value will immediately be "balanced" by the others.
This is born out by how much food I throw out because I thought I might want x last week and I actually never ate it, while other weeks I'm just craving x and really wish I'd gotten two.
posted by anaelith at 5:43 PM on March 26, 2010

FYI, Pepperidge Farm (or really Campbells, their ultimate corporate owner (at least back when I had reason to know)) runs "thrift stores" that exist purely to sell the outdated bread pulled from retail shelves, along with "off" batches of cookies and whatnot.

The bread and cookies in the store are sold past their dates up to a certain threshold, which varies by item type. Some things have progressively increasing discounts based on how many MONTHS they are beyond their sell-by date.

Who buys there? Old people, guys buying cookie packs 5.5 months past their sell-by date in bulk to stock vending machines (hoo boy, seen that and stayed away from vending machines ever since), and local restaurants and catering services (seen it).

When it was too far gone, stuff would be destroyed or sometimes put to more creative uses.

The bulk of shelf space in the thrift stores was Pepperidge Farm bread, cookies, croutons, Goldfish, soups and frozen baked goods, but sometimes random stuff from other parts of the corporate family comes in, like random bags of Godiva chocolates.
posted by NortonDC at 9:43 PM on March 28, 2010

I just wanted to point out that bread bakeries are more local than most people think they are. Although it varies by brand, non-artisan mass-market bread is produced in a way similar to soda. There may be a mix or dough slurry / batter created in a central plant somewhere (for consistency), but then it is shipped and bulk and the final baking done somewhere close to the point of consumption. These bakeries are analogous to the "independent bottlers" who take soda concentrates and produce finish products ready for sale.

This is because while baked bread is expensive to transport (it's bulky, can't be crushed, very perishable, temperature/humidity/vermin/odor sensitive), the ingredients aren't. You can ship batter or flour mix in railcars or bulk trucks, which are a lot more economical over long distances.

Just as an example, Interstate Bakeries (who produce Wonder Bread, among other things), have 54 wholly-owned bakeries scattered across the country, close to points of consumption. I suspect there are many more, doing work on contract. So while it's certainly not an artisan operation — these "bakeries" are really just food factories — it's not as though the bread you get at the store is probably coming from that far away.

So, as to your question of "would bread distribution via more localized bakeries be more efficient?" ... the system is already pretty localized. It probably doesn't make economic sense to make it more localized, because a (modern, automated, factory-like) bakery is pretty capital-intensive, and they need to have good transportation access for incoming bulk shipments. However, if transportation costs increased significantly — e.g. if the price of fuel went up — then it might make sense to open more bakeries, in even smaller cities, than currently exist. This would be because by opening more bakeries, you trade local delivery trucks for bulk transport, which is more efficient.

You might reduce waste by opening more bakeries, but the real gains would be on the supply-chain side. Retail-level waste, although it looks like a lot when you're carrying out bags of trash, is generally assumed to be small beans compared to other parts of the supply chain. It's entirely possible that someone might intentionally create or allow for retail-level waste in order to optimize more expensive parts of the supply chain, upstream. (I'm not sure exactly what the cost to the bakery is of a loaf of white bread, but I suspect it's a small fraction of the cost of one gallon of #2 road diesel.)

Reducing waste is an ordering and demand-estimation issue; as long as you have regular, predictable deliveries, and the time between deliveries is less than the shelf life of the product, you shouldn't have much waste if you order efficiently. A lot of waste at the retail level suggests to me that someone is over-ordering and generally doing a poor job managing their inventory. I'm not sure that problem would really be solved by having the bakery positioned closer. (Sending the manager to some sort of training on inventory-management, however, might.)
posted by Kadin2048 at 7:41 AM on March 30, 2010 [1 favorite]

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