Evaluating the effectiveness of circular economy initiatives in the fruit and vegetable sector at Lidl Belgium through the ReSOLVE framework.

Details

Supervisors

Mossay, Emmanuel

Faculty

Louvain School of Management

Degree label

Master [120] : ingénieur de gestion, à finalité spécialisée

Abstract

enFood waste is one of the biggest retail industry issues. One of the areas with the most waste in supermarkets is the fruits and vegetables area because they have a high perishability, need aesthetic requirement to be on shelves, demand is highly variable and logistics are challenging. This waste does not only have an economic cost, but it also has an environmental cost as it includes wasted water, land, energy and labor. The circular economy provides a solution to the linear “take-make-dispose” economy with the aim of extending the shelf life of products and materials as much as possible. The aim of this thesis is to evaluate the effectiveness of the circular principles in the fruit and vegetable sector at Lidl Belgium within the framework of the ReSOLVE levers developed by the Ellen MacArthur Foundation. The methodology used combines secondary and primary sources, which encompass semi-structured interviews conducted with internal sources. The level of value preserved through circularity practices is assessed in each initiative using Moerman's Ladder for biological flows and Lansink's Ladder for material flows. To complete the various levers and fill gaps, some recommendations based on other retailers are presented. The results indicate that Lidl Belgium has a partial effectiveness of circular economy. The most valuable contribution is to activities that prevent the losses such as demand forecasting, cold chain management and adaptive packaging. The waste management is embedded in Lidl processes, the excess quantities that do not meet customer demand on time and quantity that do not meet aesthetic requirement to be on shelves are diverted to human food, in order to keep embedded value and maximize their economic value by keeping them in circularity. Then, residual waste, that cannot be edible anymore, is transformed into renewable energy. All these practices are integrated with digital tools helping to increase the accuracy and the traceability of the supply chain. The packaging industry is also making progress in the direction of reusable and recycled packaging. Circular practices are well embedded in everyday processes and try to avoid waste as much as possible. Even if we can observe significant initiatives contributing to circularity, the effectiveness is however limited as there are no measurable outcomes, some project activities are at the testing or in the beginning of their launch and the structures depend on the core decisions of Lidl International, which is complicated to evaluate their real effectiveness. There is still need for outcomes measurement and efforts to scale up to effectively demonstrate their full impact and enhance their effectiveness.