Picture: ISTOCK
Picture: ISTOCK

London — If you’ve over-estimated the daily demand for chia seed and homemade granola pots, or dripping, do you just throw the food out, or try and sell it quickly on the cheap?

Fifty eateries in London, including Aubaine, Hummus Bros, The Quality Chop House, and Michelin-starred Aquavit, can now opt for the latter through a mobile app, Karma, which launched in the city on Thursday after an initial roll-out across 35 cities in Sweden.

"The problem of food waste is very big here, so it’s a huge market for us," said Karma co-founder Elsa Bernadotte. "London has an established food culture, a high degree of digitisation, and is getting increasingly environmentally conscious."

The UN’s Food and Agriculture Organisation (FAO) estimates that about a third of food produced for human consumption — about 1.3-billion tonnes globally — is lost or wasted each year. One study estimates that British restaurants, bars and hotels waste about 600,000 tonnes a year, worth about £17bn ($23.9bn), with restaurants accounting for the largest single share.

Restaurants with excess pre-prepared dishes can list their spare produce on Karma’s app. Users receive notifications when a nearby establishment has fresh inventory for sale. This can then be purchased through the app for a 50% discount over the usual retail cost, and collect it in person. Karma takes about a 25% cut of the sale price.

Wasted opportunity

Karma is part of a cluster of start-ups looking to connect retailers with customers to cut out waste. In January, members of the Walton family, heirs to the Wal-Mart Stores fortune, invested in FoodMaven, a US start-up creating a marketplace to find buyers for food that has been rejected by retailers. London-based Olio lets individuals give away food in tiny quantities to neighboors — an old Christmas cake (sealed) for example, or a bag of frozen parsnips. Too Good to Go offers a similar service to Karma across Europe.

Karma launched in Sweden in 2016, backed by venture capital firms including e.ventures, which previously invested in Groupon, GoToMeeting and Farfetch, as well as Sophia Bendz, a former global marketing director at Stockholm neighbour Spotify. The company said in a statement it has 250,000 users and about 1,000 food partners in Sweden.

The company began partnering with only restaurants, but now about 20% of businesses listing food on Karma in Sweden are grocery stores. "Soon it will be, maybe 50% of grocery stores," Bernadotte said in an interview. The start-up is focusing on restaurants in London, "but we are in talks with supermarkets as well, it’s coming". She declined to name any but said she was hopeful a partnership would be reached this year.

The amount of food wasted by businesses and individuals is expected to decline over the coming years, according to a spokesman for Wrap, a UK industry body and charity, and smartphone apps have been helping.

Bernadotte says Karma has about 25 full-time employees in Sweden but has no plans in place to establish a London office or hire staff in the city this year. Instead the company will run all operations from Stockholm.

Bloomberg

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