As widely expected, the government has delayed some of the planned restrictions on promoting food and drink deemed high in fat, salt, or sugar (HFSS) as part of a range of measures to mitigate the ongoing cost of living crisis.
Whilst some industry bodies and manufacturers were hoping the new regulations would be scrapped, the introduction of volume-based promotional restrictions (BOGOFs, 50% extra free deals etc.) in supermarkets and convenience stores has been put back until October 2023. However, the implementation of placement restrictions on HFSS products in high-profile locations such as aisle ends and checkouts will go ahead in October this year as planned.
Meanwhile, the ban on HFSS adverts on TV before 9pm and paid-for adverts online is being postponed for a year and will instead come into force in January 2024. The government said this was due to a delay to the Health and Care Bill receiving royal ascent and the industry needing more time to prepare. It also said a fresh consultation on the plans would be launched in the coming weeks.
The Food and Drink Federation (FDF) welcomed the moves, with its Chief Scientific Officer Kate Halliwell saying: “At a time when both families and our manufacturers are struggling with high inflation, it makes sense to delay the restrictions on volume promotions for everyday food and drink products, including breakfast cereals, ready meals and yoghurts, as it risked further stretching already-pressed household budgets.
“We also welcome the delay to the start of advertising restrictions, given the time it will take our industry to prepare for the change in law.”
However, the Association of Convenience Stores (ACS) suggested that the government’s decision to move ahead with the location restrictions will pile more costs on cash-strapped consumers while causing chaos and confusion for local shops.
ACS Chief Executive James Lowman said: “The Government’s insistence on pushing ahead with costly and confusing regulations at a time when consumers and retailers are facing significant financial pressure is nothing short of astonishing. While everyone else is trying to navigate the worst cost of living and cost of business crisis in memory, the government is regulating to send officials round to shops with tape measures to make sure yoghurt and pizza aren’t displayed too close to the door or on the end of an aisle.
“Going ahead with the location restrictions in October this year, costing thousands of pounds per store will have a huge impact on thousands of small businesses that are already struggling to make ends meet. Retailers cannot absorb these costs, they will ultimately have to pass them onto their customers during the same month that everyone’s energy costs are set to skyrocket. We once again urge the Government to rethink these regulations, and to properly consider the implications for retailers and consumers.”
Meanwhile, Health campaigners criticised the promotion restrictions delay, with Barbara Crowther of the Children’s Food Campaign saying the government should not be “delaying and dithering” but should move faster on BOGOF deals.
“Obesity is spiking and millions of families can’t afford to put proper food on the table. Multi-buy offers make people spend more on junk, and less on healthy food,” she said.
However, Public Health Minister Maggie Throup said: “We’re committed to doing everything we can to help people live healthier lives.
“Pausing restrictions on deals like buy one get one free will allow us to understand its impact on consumers in light of an unprecedented global economic situation.”
A potential delay in introducing the regulations was flagged earlier this year amid concerns about surging inflation and the rising cost of living. The promotions ban would have come into force at the same time as the energy price cap is likely to increase again.
The price of groceries has risen by almost 6% in the past 12 months, and general inflation is expected to hit at least 10% later this year.
NAM Implications:
- Whilst others can/will debate the root cause (Lockdown damage, trade sanctions vs Russia)
- Pragmatic NAMs have to focus on managing the fall-out.
- Spending a higher proportion of fixed income on food, means less on non-food…
- Time for non-food suppliers and retailers to factor this development into trade strategies.
