'Not For EU labelling will disrupt supply chain for wholesalers'

Not For EU labelling will disrupt the food and drink supply chain, see an increase in costs and a reduction in range, a leading wholesalers' body has warned, calling on the government to make certain products exempt from labelling requirements.

The government’s introduction of “Not for EU” labels from October is part of the Windsor framework, which sets out post-Brexit trade arrangements for Northern Ireland. The labels are intended to guarantee that products sold in Northern Ireland do not cross into the Republic of Ireland. Most products will have to bear the ‘Not for EU’ label from 1 July 2025.

However, Federation of Wholesale Distributors (FWD) is urging the government to make certain products exempt from labelling requirements by introducing a minimum volume threshold, alongside a phased removal of Not for EU labelling for products intended to stay within the UK market.

Government should look to phase out ‘Not for EU’ labelling for products intended to stay within the UK market. This aligns with the removal of the green lane in the Windsor Framework, which has streamlined processes and reduced unnecessary paperwork for products remaining within the UK, FWD states.

James Bielby, FWD CEO, said, “The proposals fundamentally do not work for the wholesale sector, their suppliers, or for consumers.”

“The current system of the red lane and the UK internal market system is working well for the wholesale sector. This should remain in place until the UK can establish a system which works well for businesses operating in the UK who trade across the border.

“The short timeline for implementing new labelling standards presents substantial challenges. Wholesalers need to reconfigure their supply chain, adjust to inventory management systems, and revise labelling for their own brand products. All of this comes at a huge cost and a long implementation period.”

FWD’s wholesale members in Northern Ireland report an expected shift towards EU-based suppliers due to fewer restrictions. Meanwhile, some FWD supplier members in England have communicated their unwillingness to supply products to Northern Ireland due to the additional labelling requirements.

FWD further quoted wholesalers to add that changes to labelling will cause issue with Minimum Order Quantities (MOQs), forcing them to order double the amount of products at an already increased cost. The implications for stock storage are substantial, as wholesalers must find the space to accommodate double the usual number of products due to the dual labelling requirements. Despite this challenge, there is no indication from suppliers that MOQs will be reduced, leaving wholesalers with the necessity to order both classifications of each product.