Sustainability and Waste Reduction in the Hospitality Industry: How the Right Policies can Increase Profitability

The North American hospitality industry has witnessed a significant shift in consumer behaviour and values as millennials have come of age. Authenticity, transparency, and optics now play a critical role in developing an on-going relationship with guests; whether that’s in a restaurant’s brick and mortar space, on their digital and social media platforms, through their print menus, or even during guest interactions.

According to, ‘Foodservice Facts 2019‘ millennials are Canada’s biggest spenders in the restaurant demographic. For example, consumers under 30 years old spend 44% of their food dollar on food and alcohol from restaurants compared to 27% for those 65 and older. Winning with this persuasive segment is something that every hospitality-based business needs to consider to maximize volume and profit, and ultimately thrive in this highly competitive industry.

When deciding where to dine, the majority of millennial consumers value spending with companies that have clearly-defined policies in place, dedicated to lowering their environmental impact, and that are socially responsible.

As we move through 2019, more environmentally-focused legislation is expected to be actualized, and there are serious financial benefits to hospitality-based businesses who take the lead. If executed properly, it can be a win-win for your brand and the planet. Providing restaurateurs with guidance on the strategic development and implementation of policies devoted to improving sustainability, attracting more guests, and ultimately increasing profits is critical to success in 2020.

When formulating a program, restaurants need to focus the majority of their efforts on resource reduction concerning water, waste, and energy, which ultimately translates to lowered operational costs and increased profit. A solid sustainability and waste reduction policy can also impact how employees perceive a hospitality business, ultimately aligning with the majority of millennial ethos, helping to reduce turnover and increase employee engagement.

In a survey of Restaurant Canada’s members, ‘Foodservice Facts 2019’ reported that eight out of 10 restaurant operators mention that increasing environmentally sustainable operations are essential to the success of their business. According to VCM International’s research, a one percent reduction in food waste can lead to the equivalent of a 4 per cent increase in profits. (Source, NOW Toronto).

Restaurant Canada members reported: 98 percent of foodservice operators mentioned that they recycle, 77 per cent track, compost, or donate leftover food, 93 per cent use energy or water-saving equipment, and 92 per cent plan to continue to improve their current level of environmentally sustainable operations over the next three years.
(Source, Foodservice Facts 2019, page 34)

Recycling bins and garbage outside restaurant

We have assembled some of the most impactful tips on decreasing waste and environmental footprint while connecting with millennial consumers:

1. Increase plant-based food options on your menu

A recent study by Dalhousie University found that 6.4 million Canadian are following a diet that either limits animal products intake or eliminates them completely. The harvesting of animal proteins takes a significant toll on the environment. For this reason, along with various health-related and ethical reasons, many Canadians are thinking twice about their animal protein consumption. If serving animal proteins look into procurement options that focus on sustainable farming practices.

2. Efficient menu development

Designing a menu that cross-utilizes ingredients can dramatically decrease waste and increase profits. Using one ingredient in multiple dishes, in many variations, can ease labour, ordering execution and reduce food waste. Check out Executive Chef, Steve Silvestro’s tips here.

3. Harnessing the power of technology

Utilizing in-house sales, ordering software, and apps can dramatically improve forecasting sales and ingredient procurement. According to Foodservice Facts 2019, the use of mobile apps rose to five billion dollars in 2018, in Canada. By collaborating with popular third-party apps, restaurants can access valuable analytical tools to combat food waste and profit loss.

4. Cut back on food non-food related waste

Reduce packaging by serving food that produces minimal packaging waste and is recyclable or compostable; this makes a major environmental impact in the long-run. Try reusable coasters, reusable menus, reusable coffee and tea filters, paper straws, and sign up for junk mail reduction. In washrooms install air hand dryers and refillable soap containers.

5. Have strict, but user-friendly, recycling policies

It’s always a good practice to consult with your local waste and recycling programs to ensure that you are properly recycling or composting. In most provinces and states, plastics, glass, paper, cardboard, and aluminum can all be recycled; many offer recycling options for other items too such as old POS electronics, broken kitchen equipment, batteries, light bulbs, chemicals, and more. Some areas also offer grease recycling; turning used cooking fats into biodiesel or reusable energy.

Lastly, it’s important to share with guests the steps that you are taking to reduce waste and your overall environmental impact. Reiterating the environmental initiatives that you are taking adds positive context, which can help explain to consumers why your cost of goods sold could be slightly higher.

A well-thought-out digital and social strategy, partnered with strong public relations, will ensure that your current and future guests know exactly the effort you’re making towards sustainability while earning you goodwill and increased clout in a heavily penetrated market.

Environmental sustainability and impact is something that Canadians, especially millennial Canadians, find vital, more now than ever before. Making sure that the right operational policies are in place, and that those policies are cost-effective and easy to implement, are key to hospitality success as we move towards 2020.