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South African food retailers will fight to recover fractions of a percentage point in procurement costs. They will renegotiate supplier terms, restructure logistics and redesign store layouts to protect margins that often sit below 2%. Yet when edible surplus food approaches the end of its shelf life, most accept a complete loss without first asking whether that value can be recovered.In a sector where operating margins are razor-thin, that contradiction should be impossible to ignore. Retailers scrutinise every line of expenditure, except the one walking out the back door as waste.For decades, surplus food has been treated as an unavoidable cost of doing business. Once products near expiry, they are written off under shrinkage or waste. From an accounting perspective, this may appear neat. Commercially, it’s anything but. Every unit written off carries embedded capital (logistics, cold-chain energy, water, land use) that never appears as a line-item loss. Retailers are not just losing product; they’re burning invested resources and calling it business as usual.From ESG report to executive dashboardSustainability teams alone have owned this conversation for too long. Food waste is not a reporting exercise, it’s a margin-protection failure, and it belongs to the CFO. It should be treated as a measurable commercial KPI, tracked with the same discipline as stock turn, gross margin and sales per square metre.Surplus food affects profitability, compliance, operational efficiency, customer value and environmental performance at the same time.Few indicators cut across a retail business so directly. Yet in many organisations, food waste is still measured mainly by tonnes diverted, volumes donated or landfill reduction, and while these are important metrics, they don’t tell the full commercial story.Boards should be asking: how much value was recovered from surplus inventory? How quickly was edible stock redirected before expiry? What percentage of surplus food remained in the value chain? These questions move food waste from a soft ESG report to a hard-hitting executive dashboard.The global cost of inactionInternational data shows why this matters. The 2026 food waste report by the nonprofit ReFED found that surplus food represents $380bn (R6.3-trillion) in lost economic value annually in the US, with commercial sectors accounting for $122bn of that loss. Despite growing awareness, most surplus food still ends up in traditional waste streams, while only a small percentage is successfully rescued. More than one-third of all food produced locally is lost or wasted before it reaches consumers, which is not only an environmental problem but a significant commercial failureSouth Africa reflects many of the same structural inefficiencies as seen globally. More than one-third of all food produced locally is lost or wasted before it reaches consumers, which is not only an environmental problem but a significant commercial failure. Regulation is coming for the write-offThat blind spot is about to become more expensive as well. The Western Cape government has already adopted a zero-organic-waste mandate, aimed at eliminating organic matter (such as food and garden waste) from landfills by 2027. The draft National Waste Management Strategy 2026 signals that similar pressure will extend nationally, with increasing focus on circular economy principles and landfill restrictions.As compliance costs rise, retailers that continue treating surplus as a passive write-off will face growing financial exposure. The era of burying the problem (literally) is ending. Retailers that don’t shift to tech-enabled surplus monetisation within the next 18 months will find themselves paying twice: once in lost product value, and again in landfill compliance penalties. The window to act voluntarily is closing fast. Recover value before it becomes wasteThe opportunity here is to manage surplus food before it becomes waste. We can recover revenue on what retailers would otherwise consider a stranded asset, while driving physical foot traffic back to stores; not only through charity logistics but by creating an additional commercial pathway for edible food that might otherwise leave the system entirely.The retailers that lead over the next decade will not be those that simply dispose of surplus more efficiently. They will be those that measure it, manage it and recover value from it. Because once food waste becomes a KPI, it stops being an invisible loss and becomes an ownable business performance issue. Retailers that embrace this shift earliest will gain more than incremental revenue recovery. They will build stronger forecasting capabilities, improve inventory visibility, reduce operational inefficiencies and create more agile supply chains. In an increasingly competitive retail environment, the ability to extract value from every stage of the product lifecycle will separate high-performing businesses from those still relying on traditional write-off models. Surplus management should no longer be viewed as a downstream operational task but as a strategic capability that strengthens commercial resilience. This is ultimately a leadership decision. Every major efficiency gain in retail has started with executives choosing to measure something differently. Shrinkage, stock availability, procurement and logistics all became board-level priorities because they were recognised as drivers of financial performance. Surplus food deserves the same treatment. The businesses that act now will not simply waste less: they will build more profitable, resilient and future-ready organisations. In the years ahead, recovering value from surplus food is unlikely to be viewed as an innovation. It will simply be regarded as good retail management.Holbak is CEO and founder of Refreshi, South Africa’s surplus food marketplace
