Wal-Mart

Stores, Inc.
RED Initiative

Prepared for
The Dallas Chamber of Commerce


Prepared by
Amaha Tesfaye, Meagan Williams, Parth Vaghela, Nick Vinella



November 28, 2015

Table of Contents

Introduction ................................................................................................................................................ 1

Wal-Mart Stores, Inc. ................................................................................................................ 1

The North Texas Food Bank (NTFB) ................................................................................... 2

Global Responsibility & Sustainability: Targeting Zero Waste ................. 1

Current NTFB Programs ............................................................................................ 2
The Future of NTFB .................................................................................................... 3

Background .................................................................................................................................................. 3
The Problem of Food Waste .................................................................................................. 3
Consumer Demand of Aesthetic Food Products ............................................ 4
Lack of Label Reform ................................................................................................. 4
Obstacles in Recovering and Donating Food ................................................... 5
Hunger in the Dallas Community ........................................................................................ 5
Proposal ......................................................................................................................................................... 8
Step 1. REFORM .......................................................................................................................... 8
Step 2. EDUCATE ........................................................................................................................ 8
Step 3. DONATE .......................................................................................................................... 9
Staffing ............................................................................................................................................ 9
Budget ............................................................................................................................................................ 9
Authorization ........................................................................................................................................... 10
References ................................................................................................................................................. 12
Targeted Questions & Answers ........................................................................................................ 14

Wal-Mart Stores, Inc. | North Texas Food Bank - RED Initiative

Introduction

As the worlds largest grocer, we have an opportunity to use our global scale and resources
to positively impact the communities we serve. In collaboration with the North Texas Food
Bank, we can leverage our strengths to tackle food waste and hunger in the DFW area.
The RED Initiative is a three-pronged proposal that is designed to synergistically tackle
food waste and hunger through
Reform: establish a standard packaging and labeling system.
Education: educate our consumers to make smarter choices
Donations: properly sort and donate food to local food banks

Wal-Mart Stores, Inc.
Wal-Mart (NYSE: WMT) is an American multinational retail corporation that operates a
chain of supermarkets. According to the Fortune Global 500 list in 2014, Wal-Mart is the
worlds largest company by revenue, as well as the worlds biggest private employer with
2.2 million employees (Soni, 2015).

Global Responsibility & Sustainability: Targeting Zero Waste
In a study conducted by Godfray (2015), it was estimated that than by 2050, more than 9
billion people will live on earth. Food production must increase roughly 70% to feed that
many people (p. 2). Therefore, there is a growing need to integrate environmentally sound
and sustainable programs to reduce waste in food production supply chain. Reducing
waste requires a coordinated effort between Wal-Mart, farmers, consumers, and charitable
organizations. And through the Zero Waste to Landfill program, Wal-Mart hopes to achieve
zero waste.
Figure 1: Wal-Mart Zero-Waste-to-Landfill Program

Wal-Mart Stores, Inc. | North Texas Food Bank - RED Initiative

The North Texas Food Bank (NTFB)
Mission Statement
NTFB passionately pursues a hunger-free community.
The North Texas Food Bank was founded in, 1982 to address the critical issue of hunger in
the North Texas community. In its first year, NTFB managed to donate 400,000 pounds of
food. Currently, North Texas Food Bank serves 13 counties and 1,000 feeding locations
(Miller, 2010).
NTFB managed to provide 62 million nutritious meals last year, and on average
provides 170,000 meals daily (Miller, 2010).
NTFB has 31,000 volunteers (Horner, 2010).
Today, NTFB is a certified member of Feeding America, the nations largest domestic
hunger relief organization. The NTFB and Feeding America engage with their communities
by distributing donations of surplus food and grocery products through a network of
charitable events. Together they continue to educate and fight against hunger within the
communities they serve (Stewart, 2015).
Current NTFB Programs
North Texas Food Bank has many programs that are aimed at reducing food insecurity.
- Community kitchens and pantry
- Disaster reliefs
- Nutrition services/Produce and Gardening
- SNAP programs
- Children programs
- Senior programs
In addition to established programs, the North Texas Food Bank also has many reputable
partnerships and campaigns with local organizations.
Stampede against Hunger
This is a partnership between NTFB and Southern Methodist University (SMU).
Through this partnership, NTFB is able to set up additional food banks, increase
hunger awareness and community engagement, and provide volunteering
opportunities for SMU students, faculty, and staff.
Uber Food Drive
Through this partnership, Uber provides free donation pick up services (Stewart,
2015).

Wal-Mart Stores, Inc. | North Texas Food Bank - RED Initiative

The Future of NTFB
The organization recently announced a three-step plan, on September 14, 2015, that
illustrates how it plans to expand in the coming years. The idea is based on a 10-year
strategic plan to provide 92 million meals annually by 2025 (Miller, 2010).
1. Community engagement: NTFB will focus on community engagement which is
primarily to attract prospective stakeholders, partner agencies, clients, volunteers,
and donors be engaged in the community.
2. Expansion: the purpose of expansion is to his improve the network of access to
nutritious foods.
3. Visibility: the goal of visibility is to provide client visibility by showing the overall
impact of the NTFB network. This shows NTFB is striving to enhance its already
established mission and continue to strive against eliminating hunger (Stewart,
2015).
We believe that the North Texas Food Bank will be an integral partner in the fight against
hunger and food waste. Over the years they have showed continued growth, unwavering
commitment and work ethic, and integrity to nurturing the lives of Dallas denizens.
Through the RED Initiative, we will be one step closer to addressing food insecurity and
waste.
Background

The Problem of Food Waste
Americans waste a large amount of food! The Natural Resource Defense Council (2013)
reports that up to 40 percent of food that is produced is
never eaten, and up to 30 percent of all produce never
These calculations assumes
makes it to store shelves.
2,500 kcal/capita/day and
According to a study by Hall (2009), US per capita
an annual total of 150
food waste has progressively increased by ~50%
trillion calories in losses, as
reported in K.D. Hall, J. Guo,
since 1974. At this rate Americans throw away
M. Dore, C.C. Chow, National
roughly $165 billion dollars worth of food in one
Institute of Diabetes and
year.
Digestive and Kidney
Halls (2009) study found that reducing national
food waste by 15% would provide nutrition for an additional 25 million people.
Food waste and Food insecurity are very real and very large problems in the United States.
Retailers have tried to reduce food waste through streamlined supply chains. Nonprofit
organizations have tried collecting and donating food. Farmers have tried to recover and
donate. Unfortunately, as shown in Figure 2, food continues to make the largest component

Wal-Mart Stores, Inc. | North Texas Food Bank - RED Initiative

of landfills at 22%. Furthermore, food waste contributes to greenhouse gases, waste of

labor, and resources it took to produce the food.
Figure 2: Municipal Solid Waste (MSW) Characterization, 2010

Consumer Demand of Aesthetic Food Products

The Food and Drug Administration (FDA), producers, retailers, and consumers scrutinize
the quality of produce. The FDA has set strict protocols on the aesthetics of produce.
Produce that does not meet standards set by the FDA can lose up to two-thirds of its value,
even when it has the same nutritional value as produce considered normal. Therefore,
producers reject up to 29% of produce, because it does not meet the FDAs or retailers
strict standards (Porterfield, 2015).

The problem is further exacerbated by consumer demand. Consumers tend to be impulsive
buyers and are hesitant to purchase produce that is considered outside the norm of
perfectly uniform food (color, shape, size). Consumers also have the impression that a less
stocked shelf indicates lower quality food. The problem is made even worse by grocers
who routinely overstock their shelves, so that customers have more options. In reality, both
less and well-stocked shelves provide essentially the same nutritional value. Eventually
unsold food is thrown away prematurely, before it actually expires or is deemed unsafe for
consumption.

Lack of Label Reform
According to a study conducted by the National Resources Defense Council and Harvard
Food and Law Policy Clinic (2013), 60% of consumers report that food labels confuse them.
Labels such as sell by, freshest by, and freeze by all add to the uncertainty. Currently,
there are not any nationwide guidelines established to standardize food labels. The Food
and Drug Administration only mandates baby formulas to carry the sell-by-date. As

Wal-Mart Stores, Inc. | North Texas Food Bank - RED Initiative

displayed in Figure 3, only 9 states enforce sell-by-date on all foods, and Texas is not one of
them. Implementing a standard labeling system across all foods and producers can help to
lessen confusion and stop food from being thrown away prematurely.

Figure 3: States Requiring Date Labels on At Least Some Food Products

Obstacles in Recovering and Donating Food
Producers and retailers are reluctant to sell products that appear subpar, or have slight
imperfections. They would rather throw away food than donate it. This is because there are
a lot of overhead costs and legal issues associated with donating food to nonprofit
organizations.
Donating food can be costly. Getting food to those who need it is expensive, because
it requires additional labor, packaging, and transportation.
Producers and retailers fear the legal consequences of donating food. Fortunately
there are Good Samaritan laws in place to protect donors.
In 1996, President Clinton signed into law the Bill Emerson Good Samaritan Food Act. The
bill provides exemption to those who donate wholesome food in good faith, to a qualified
non-profit organization, from civil or criminal liability. May farmers and grocers are not
even aware the bill exists.
Hunger in the Dallas Community
Food insecurity in the North Texas area is a major problem that needs to be brought to
attention. According to a study done in 2013 by hunger-relief charity Feeding America,
nearly 20 percent of Texans are food insecure (Heinz, 2013). In the report, the data showed

Wal-Mart Stores, Inc. | North Texas Food Bank - RED Initiative

that 38 percent of food-insecure Texans were above the poverty line and therefore
ineligible for federal nutrition programs like SNAP (Heinz, 2013). Hunger in Texas is at a
high but its North Texas that suffers the most with Dallas having the highest food
insecurity rate.
Dallas County food insecurity rate 20.6%.
In Dallas 484,510 people were food insecure, 172,610 of whom were children.
26 percent of food insecure families were above the poverty line.

Figure 4: Food Insecurity in Texas, 2015 Figure 5: Hunger in North Texas

For these families above the poverty line, their only means of getting a meal may be the
North Texas food bank or another food pantry. Data obtained from The Texas Health and
Human Services Commission shows that in Dec., 2011, there were 1.5 million families
receiving SNAP benefits, feeding an estimated 3.7 million Texans (Heinz, 2013) "Fifty-seven
percent of all food-insecure households participated in one or more of the three largest
Federal food and nutrition assistance programs during the month prior to the 2011
survey," the USDA reported (Heinz, 2013). The families above the poverty line are not able
to receive benefits from these food assistance programs and therefore these people and
their children face food uncertainty and go hungry.
According to the North Texas Food bank, about one in four children to not have
access to nutritional meals on a daily basis.
In Texas 27.6 percent of children are food insecure which is 5.2 percent above the
national average (Heinz, 2013).
Experts said the higher number in food insecurity in children is derived because
there are often several children in one family that is struggling to put food on the
table. (Heinz, 2013).

Wal-Mart Stores, Inc. | North Texas Food Bank - RED Initiative

Texas has one of the higher food insecurity rates in the United States with about 20 percent
of people being food insecure.
Figure 6: Prevalence of Food Insecurity, average 2011-2013

Food insecurity has a series of ramifications other than hunger. Coleman (2013) notes that
for many, this includes psychological consequences as well. If the Dallas chamber of
commerce were to donate to the RED Initiative we would be able to prevent many hunger
related problems such as:
Anxiety and poor nutrition
Children learn less than their peers.
More likely to repeat a grade level
May have physiological problems
Increased chance to become obese
Depression among adults
Teenagers are twice as likely to be suspended from school.
With the RED Initiative we will be one step closer to conquering hunger in North Texas and
the United States as a whole.

Wal-Mart Stores, Inc. | North Texas Food Bank - RED Initiative

Proposal
In an effort to conquer food waste and hunger, in the Dallas community, our team has
prepared a community action project.
The RED Initiative is composed of three key steps that are designed to end food waste and
hunger.
1. Reform
2. Education
3. Donation.
Step 1: REFORM
We all know how confusing it is to go to a grocery store, read all the product labels, and still
not know which product is safe to consume. This is a common misunderstanding among
consumers. Our first step of the RED Initiative is to reform the current food labeling system
to be more understandable. Being the largest grocer in the world, means Wal-Mart has
some leverage in making a standardized labeling system happen. Wal-Mart would then in
turn lobby the government, specifically the FDA, and propose our new labeling system. The
new system would be implemented in our stores worldwide; therefore, our vendors would
be obligated to abide by said standard. When consumers buy a product, having so many
misleading labels attributes to the overall pounds of food wasted. For example, a consumer
would not buy a product that has an expired Sell by label, but all this label stands for is to
let producers know when they need to sell the product to retailers. The product in turn is
perfectly fine for consumers, but will not be sold and therefore wasted. That is what we
strive to fix. By introducing this standardized labeling system, we plan to reduce the
misunderstanding between producers, retailers, and of course consumers.
Step 2: EDUCATE
Our second step of the RED Initiative is to educate consumers to make smart choices in
their purchases. About 70% of all household waste ends up in landfills annually. This is not
just food being wasted if you think about it. Another valuable resource for consumers is
being wasted: money. On average $50 a month is wasted, not per household, but per
individual. Just a single person wastes $600 a year on food that will just end up in a landfill,
furthermore contributing to the issue of food waste. Wal-Mart wants to emphasis key
factors in how to avoid wasting food and money.
Before consumers head to the grocery store we advise making a list before
impulsively buying what individuals think they need.
Plan meals by the Use By date. This is the label consumers need to keep in mind
above all others.
Save leftover food by freezing it in temperatures of 1-5 .

Wal-Mart Stores, Inc. | North Texas Food Bank - RED Initiative

Food that will not be used can all be used as compost in gardens.
With the RED Initiative we plan to post banners in store locations educating customers on
these food-wasting pointers. We also plan to use our already established social media sites
to inform our followers.
Step 3: DONATE
Our last step is to connect the two major problems of food waste and hunger by donating
food unsold to our local non-profit North Texas Food Bank. We previously discussed how
creating a strong partnership with NTFB will lead to our success in the RED Initiative. This
is also the largest portion of our proposal. We propose to create a go-between that will
connect the two large infrastructures. Dallas is such a large area; therefore, we want to
focus on 25 locations at first. Our plan is to have overnight employees at Wal-Mart rotate
the stock that will not be sold due to confusing labels, package the products, and pack
North Texas Food Bank trucks full of unwanted food. We want to target the Wal-Mart
locations that neighbor malnourished regions of Dallas to efficiently help those in need. We
want to focus on 25 locations at first for three months to have controlled progress reports.
This will enable us to tweak any part of the process that needs additional work. Once the
process is perfected we plan to launch the RED Initiative in other parts of the state and
eventually nationwide. By taking Wal-Marts unused products and giving back to the
community we can help reduce levels of hunger while focusing on eliminating food waste.
Staffing
The last step in the RED Initiative will need additional employees for our 25 Wal-Mart
locations. We want to create new job opportunities in the community instead of pulling
from our in-house employees daily tasks. This will result in another positive incentive to
our proposal. By targeting our 25 Dallas locations and hiring an additional 4 individuals per
location, we would be employing 100 Dallas locals who are unemployed currently. We plan
to use these new overnight employees 5 days a week, working 7 hours a day, and pay them
$10 an hour. This will eventually reach all of our goals: eliminating food waste, reducing
Dallas hunger levels, and giving back to our community.
Budget
The RED Initiatives budget is based on a 3-month plan, at 25 Wal-Mart locations. This will
allow us to study the effectiveness of the proposal in a manageable way while we focus on

Wal-Mart Stores, Inc. | North Texas Food Bank - RED Initiative

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Table 1: RED Initiative Budget Breakdown For Each Wal-Mart Location

RED Initiative Budget
Total Expense per Store (1 Week)
Employees
4

Hours per Week

Rate ($/hr.)

Total

35

$10

$1,400.0

Weeks per Quarter

Total

12

$420,000

Expenses per Quarter (25 Store Locations)

Total Store Locations

Total Expense per Store

25

$1,400

Total Expenses per Quarter

$420,000

Contribution

$210,000

As you can see the majority of our budget comes from labor expense. At this point in our
proposal we do not see any additional expenses being included. This is another reason we
wanted to have a strong partner such as North Texas Food Bank. This company already has
the manpower, refrigerated trucks, and warehouse space needed to take on this project.
Once our RED Initiative proposal takes off Wal-Mart will be able to cover the necessary
expenses. All we ask of you, the Dallas Chamber is contribute half of our calculated budget.

Conclusion
We come to you because we understand how important our community is to your
organization. We want the Dallas Chamber to realize how important the community is to us
as well. With your contribution we plan to help 10% of the total Dallas malnourished
population. Dallas has a population of 1.258 million, sadly 20% of the population live in a
food insecure household. By targeting 10% of these individuals we could help 25,160
people. The RED Initiative would establish a standardized labeling system, educate
consumers on food waste reduction, and be able to donate food to local non-profits.

Authorization

Wal-Mart Stores, Inc. | North Texas Food Bank - RED Initiative

Targeted Questions & Answers

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Wal-Mart Stores, Inc. | North Texas Food Bank - RED Initiative

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References
Coleman-Jensen, A., Nord, M., & Singh, A. (2013). Household Food Security in the United
States in 2012. USDA ERS. - See more at:
http://web.ntfb.org/learn-more/learn-more-about-hunger/hungerfacts#sthash.ztpCWsKK.dpuf

Godfray, C. (2015, August 19). Food Security: The Challenge of Feeding 9 Billion People.
Retrieved November 15, 2015, from
http://web.mit.edu/12.000/www/m2019/pdfs/Godfray_2010_Science.pdf
Hall, K., Guo, J., Dore, M., & Chow, C. (2009). The Progressive Increase of Food Waste in
America and Its Environmental Impact. PLoS ONE.
Heinz, F. (2013, June 6). Texas Food Insecurity Higher Than National Average. Retrieved
December 2, 2015, from
http://www.nbcdfw.com/news/health/Texas-Food-Insecurity-Higher-ThanNatioal-Average-210440211
Horner, K. (2010, November 4). Food Pantries Stretched Thin. Retrieved November 15,
2015, http://www.ntfb.org/media_articles_11042010.cfm
Miller, R. (2010, August 15). North Texas Food Bank's drive aims to Close the Gap on
hunger. Retrieved November 15, 2015, from
http://web.ntfb.org/page.aspx?pid=253
Natural Resources Defence Council (NRDC), Harvard Food and Law Policy Clinic (2013).
The Dating Game: How Confusing Food Date Labels Lead to Food Waste in America.
(1st. ed). Washington, DC. The National Resources Defense Council.
http://www.nrdc.org/food/files/dating-game-report.pdf
Porterfield, A. (2015, July 7). Farmers abandoning organic farming despite lure of higher
price premiums | Genetic Literacy Project. Retrieved November 5, 2015, from
http://www.geneticliteracyproject.org/2015/07/07/farmers-abandoning-organicfarming-despite-lure-of-higher-price-premiums/
Stewart, M. (2015, November 12). Canned Food Drive on behalf of the North Texas Food
Bank. Retrieved December 1, 2015, from http://www.kraftlaw.com/legalarticles/canned-food-drive-on-behalf-of-the-north-texas-food-bank/

Wal-Mart Stores, Inc. | North Texas Food Bank - RED Initiative

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List of Figures and Tables

Figure 1. Targeting Zero Waste. Walmart Zero-Waste-to-Landfill Program Retrieved
October 28, 2015.
website: http://corporate.walmart.com/global-responsibility/sustainability/
Figure 2. Municipal Solid Waste Generation, Recycling, and Disposal in the United States:
Facts and Figures for 2010. Retrieved October 27, 2015 from United States
Environmental Protection Agency www3.epa.gov
website:
http://www3.epa.gov/epawaste/nonhaz/municipal/pubs/msw_2010_rev_factsheet
.pdf
Figure 3: The Dating Game: How Confusing Food Date Labels Lead to Food Waste in
America. States Requiring Date Labels on At Least Some Food Products. Retrieved
October 27, 2015.
website: http://www.nrdc.org/food/files/dating-game-report.pdf
Figure 4: 2015 Food Insecurity Data. (2015). Retrieved December 2, 2015, from
website: http://www.houstonfoodbank.org/media/128223/2015 food insecurity 1 in 6 texans-01_300x224.jpg

Figure 5: Hunger in North Texas. (2014). Retrieved December 2, 2015, from
website: http://web.ntfb.org/document.doc?id=331
Figure 6: Prevalence of food insecurity. (2014). Retrieved December 2, 2015, from
website: http://www.tysonhungerrelief.com/wpcontent/uploads/2015/02/foodInsecurityMapUSDA.png
Table 1: Budget for The RED Initiative

Wal-Mart Stores, Inc. | North Texas Food Bank - RED Initiative

Targeted Questions & Answers

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