To reduce food waste, a dynamically adjustable shelf life and discounting strategies can be used by a retailer selling perishable products. In this paper both strategies are investigated and evaluated in terms of profit, waste reduction and shortages.
In this paper the effect of dynamic shelf life (a dynamically adjustable expiration date) and discounting products when they are close to expiration are evaluated in terms of waste reduction, profit and shortages. A simulation based optimization model is used to optimize the replenishment of a retailer selling meat products. Results show that a dynamic shelf life outperforms a fixed shelf life in terms of waste, profit, shortages and food safety. For highly perishable products, the benefits of a dynamic shelf life increase. Discounting products which are close to expiration is also a successful strategy to reduce food waste, even more when combined with a dynamic shelf life.
M.E. Buisman, R. Haijema, J.M. Bloemhof-Ruwaard, Discounting and dynamic shelf life to reduce fresh food waste at retailers, International Journal of Production Economics, 2017, ISSN 0925-5273, http://dx.doi.org/10.1016/j.ijpe.2017.07.016.