Social Responsibility and Operational Efficiency
Problem definition: The charitable donation of leftover or surplus food forms a key part corporate social responsibility in food retail. Food donations, as an alternative to price-discounting or discarding, may help simplify the logistical movement and handling of outdated food in-store and, potentially, increase operational efficiency. In this paper, we examine the relationship between social responsibility and operational efficiency using store-year production and donation data.
Methodology/results: We use data from 14 major retail banners that donated to two large Feeding America member Food Banks from 2015 to 2021.We use stochastic frontier analysis and account for the endogeneity of labor input and donation volumes using control functions.
We find that donations increase operational efficiency, and that more efficient stores donate more surplus food. Managerial implications: Social responsibility and operational efficiency represent complementary capabilities in food retailing. Lean inventory management practices for perishable food products should consider end-of-life disposition routines, and the variability in manual labor associated with these routines.
Key words: Food donations, retail operations, stochastic frontier analysis, complementary capabilities
John Lowrey
John Lowrey is an Assistant Professor of Supply Chain & Information Management and Health Sciences at Northeastern University DMSB. His research spans interdisciplinary fields and concerns topics like food waste, food donations, retail operations, and preventative healthcare. He has worked with several of the largest Feeding America member Food Banks on food procurement and distribution-related projects and served on advisory boards related to sustainable business and food insecurity. His healthcare focus is related to chronic care models, clinic-community integration, and achieving population health at scale by operationalizing “screen-and-intervene” logic models.
His research has been published in top management, economics and public health journals, including Manufacturing & Service Operations Management, Journal of Operations Management, Journal of Business Logistics, American Journal of Agricultural Economics, European Review of Agricultural Economics, Preventing Chronic Disease, among others. His work is also commonly cited in the popular press and appears in outlets like Fast Company, The Conversation, Reuters and Boston Globe.
Lowrey received his Ph.D. in Operations Management at Fisher College of Business at The Ohio State University. Lowrey also holds a M.A.E., M.B.A., and M.S. from The Ohio State University. He received his Bachelor of Science from The University of Akron.
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