All major supermarkets and retailers that sell groceries, such as Kroger, Walmart and Costco, give large amounts of food to food banks and pantries. In 2022, retailers donated close to 2 billion pounds of food across the United States, which amounted to US$3.5 billion that year. The estimated value of donated food was a little less than $2 per pound in 2022.

Retailers donate products that are typically packaged, palatable and safe for consumption, yet unsuitable for sale due to quality concerns, such as minor blemishes. Since these items can go a long way to feeding hungry people, donations represent one of the best uses of leftover or surplus food.

Donations are also technically acts of charity, and the companies responsible for them get tax breaks. This means that donations boost profits by lowering costs. There’s a second effect of donations on a store’s bottom line: They improve the quality of food on the store’s shelves and increase revenue from food sales.

As a supply chain scholar who studies food banks, I worked with a team of economists to estimate the effects of retail food donations. We used sales data for five perishable food categories sold by two competing retail chains, with stores located in a large, Midwestern metropolitan area. We found that stores that remove items on the brink of expiration, donate them to food banks and fill up the emptied shelf space with fresher inventory get more revenue from sales and earn higher profits.

Retailers donate 30% of what food banks give their clients

U.S. food banks, which have been operating for more than 50 years, give away over 6 billion pounds of food annually.

They get about 30% of that food for free from supermarkets and big-box retailers that sell groceries. Prior to the start of the COVID-19 pandemic, retailers supplied more than twice as much food to food banks as the federal government did. The volume of food supplied by federal programs administered by the United States Department of Agriculture, such as the Emergency Food Assistance Program, has steadily increased since 2020, to now almost match the volume of food donated by retailers.

In 2022, for example, the network of more than 200 Feeding America member food banks procured about 2 billion pounds from retailers and almost 1.5 billion pounds from government programs.

The remaining 2.88 billion pounds of food were either purchased directly, provided by farmers, donated by food processing companies or donated by people and organizations in local communities.

Despite several federal programs that help low-income people get food and the nation’s robust network of food banks and food pantries, nearly 50 million Americans are experiencing food insecurity. That means they can’t get enough nutritious food to eat at least some of the time.

Retail donation routines are established but inconsistent

When food on a store’s shelves is on the verge of expiration, store managers have three options. They can donate or discard it, or sell it at a discount.

Stores that regularly donate food have established routines for when they set aside about-to-expire food to give away. However, these routines are often inconsistent.

Many stores donate only on a seasonal basis or just give away certain kinds of food. For example, they might donate only meat, baked goods or fruits and vegetables. In many cases, donations take a backseat to more immediate priorities, such as customer service.

Those realities can increase the likelihood that food will land at the dump instead of on somebody’s table.

Although millions of Americans struggle to find their next meal, close to 40% of food gets thrown out along the supply chain, as food moves between agricultural producers, factories, retailers and consumers. This is largely due to logistical challenges: It’s hard to transport and distribute highly perishable food.

Discounts on food can undercut sales

Stores often prefer to sell food on the brink of expiration at a discount rather than donate it or throw it out due to the money they recoup that way. This option, however, also keeps the discounted food on the shelf, where it takes up valuable space that could otherwise hold fresher inventory.

Shelf space dedicated to the sale and promotion of full-priced products competes with that for price-discounted food. Stocking perishable foods that are starting to look iffy—such as bananas with brown spots sold alongside unblemished yellow bananas—could harm a retailer’s image if shoppers start to question the store’s quality.

In other words, if consumers make judgments based on all the produce that’s on display, then it may be better for stores if they don’t sell sad-looking bananas and instead just give them away.

My research team calls this practice “preemptive removal.” Increasing the average quality level of food on display does more than improve a store’s appearance. We used panel data with over 20,000 observations, and we included 21 retail stores that compete in a similar market geography. The five fresh food categories were bakery, dairy, deli, meat and produce.

Stores that donated food, instead of discounting it, may have made better use of the limited room to display fresher inventory. My research team found that food donations can increase average food prices by up to 1%, which corresponds to a 33% increase in profit margins. Profit margins for supermarkets and other food retailers are quite low and typically hover below 3%.

That means even a small increment in food prices, even a 1% bump up, can translate into significantly higher profits for retailers. At the same time, increasing the volume of retail food donations would get more food to people who need it, limit hunger and reduce food insecurity.

This article is republished from The Conversation under a Creative Commons license. Read the original article.

Parents in California who profit from social media posts featuring their children will be required to set aside some earnings for their minor influencers under a pair of measures signed Thursday by Gov. Gavin Newsom.

California led the nation nearly 80 years ago in setting ground rules to protect child performers from financial abuse, but those regulations needed updating, Newsom said. The existing law covers children working in movies and TV but doesn’t extend to minors making their names on platforms such as TikTok and Instagram.

Family-style vlogs, where influencers share details of their daily lives with countless strangers on the internet, have become a popular and lucrative way to earn money for many.

Besides coordinated dances and funny toddler comments, family vlogs nowadays may share intimate details of their children’s lives — grades, potty training, illnesses, misbehaviors, first periods — for strangers to view. Brand deals featuring the internet’s darlings can reap tens of thousands of dollars per video, but there have been minimal regulations for the “sharenthood” industry, which experts say can cause serious harm to children.

“A lot has changed since Hollywood’s early days, but here in California, our laser focus on protecting kids from exploitation remains the same,” he said in a statement. “In old Hollywood, child actors were exploited. In 2024, it’s now child influencers. Today, that modern exploitation ends through two new laws to protect young influencers on TikTok, Instagram, YouTube, and other social media platforms.”

The California laws protecting child social media influencers follow the first-in-the-nation legislation in Illinois that took effect this July. The California measures apply to all children under 18, while the Illinois law covers those under 16.

The California measures, which received overwhelming bipartisan support, require parents and guardians who monetize their children’s online presence to establish a trust for the starlets. Parents will have to keep records of how many minutes the children appear in their online content and how much money they earn from those posts, among other things.

The laws entitle child influencers to a percentage of earnings based on how often they appear on video blogs or online content that generates at least 10 cents per view. The children could sue their parents for failing to do so.

Children employed as content creators on platforms such as YouTube will also have at least 15% of their earnings deposited in a trust for when they turn 18. An existing state law has provided such protection to child actors since 1939 after a silent film-era child actor Jackie Coogan sued his parents for squandering his earnings.

The new laws will take effect next year.

The laws have the support from The Screen Actors Guild-American Federation of Television and Radio Artists, or, SAG-AFTRA, and singer Demi Lovato, a former child star who has spoken publicly about child performers abuse.

“In order to build a better future for the next generation of child stars, we need to put protections in place for minors working in the digital space,” Lovato said in a statement. “I’m grateful to Governor Newsom for taking action with this update to the Coogan Law that will ensure children featured on social media are granted agency when they come of age and are properly compensated for the use of their name and likeness.”

The new laws protecting child influencers are part of ongoing efforts by Newsom to address the mental health impacts of social media on children. Newsom earlier this month also signed a bill to curb student phone access at schools and ban social media platforms from knowingly providing addictive feeds to children without parental consent.

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