Christmas, or the “key festive trading quarter” (as it is hailed in retail), is tinkling towards us. This year it is flanked on one side by the FIFA World Cup, charging at the wide-open goal of greater profits; on the other side, it is in danger of being tackled by a developing cost-of-living crisis and fuel shortage that threatens to make shoppers super-glue their wallets shut.
To start with the problems and opportunities presented by having the 2022 FIFA World Cup so close to the Christmas holidays.
The World Cup, which was postponed to the winter to avoid Qatar’s intense summer temperatures, has completely derailed the algorithms retail chiefs are increasingly using to predict trade and plan their logistics. But is this really a disaster in the making?
Santa shoots, Santa scores
Reports are abounding that the Winter World Cup (as opposed to the Desert World Cup, perhaps more apt) has added a new level of uncertainty to UK Christmas grocery sales. Reuters, for example, reported recently that questions are being raised about how to persuade shoppers to buy Christmas goodies such as luxury biscuits at the same time as beer and pizza – or perhaps to figure out how to get cash-strapped consumers to spend once during the World Cup tournament and then spend again a few weeks later over the Christmas period: “This is a bit of a curveball in terms of how to plan for Christmas and a World Cup at the same time,” Ken Murphy, chief executive of Tesco told reporters last month.
It is true that the football tournament in Qatar, taking place between November 20 and December 18, falls slap bang in the important festive “commercial district” where the highly competitive sector normally generates a large part of its annual profit.
Similarly, World Cups, which traditionally take place in the northern hemisphere during the summer, tend to give UK supermarkets a big boost as households stock up on beer, wine and spirits, grills and snacks and host large gatherings. (But few BBQs in December.)
Photo: iStock
As Murphy hinted, buyer confidence was at record lows even before the government’s new economic plan, now reversed, sent mortgage rates soaring and sparked fears that a sharp fall in house prices could worsen the cost-of-living crisis.
Many think this means that the combined consumer indulgence in November-December is likely to be less than if the two main events were further apart.
But as we can gather from Barclaycard’s observations, the fact is that families take Christmas very seriously and have already begun squirrelling away funds to celebrate the holiday. If anything, the cost-of-living crisis has probably focussed minds more intensely on making sure there is enough to spend on having a good time over the winter equinox.
The FIFA World Cup should probably then be seen as an adjunct to Christmas sales rather than a Grinch-like thief – mums will not allow dads to blow the budget on beer, leaving the kids without selection boxes and plenty of pop.
In addition, there are other factors that suggest Christmas will survive the soccer competition:
Shoppers are cutting down on dining out, suggesting they are planning to celebrate at home. Even if total consumer spending shrinks, it’s a greater proportion of remaining cash will go on goods purchased in c-stores.
Supermarkets are particularly anxious over lost sales, and this might be due not to no sales but more local sales: part of cutting down on expenses is not loading the car up so much, and consumers staying local may well favour local shops.
Many Christmas-related purchases are impulse and self-treating buys. That is why companies such as Mondelēz suggest stocking Christmas-related chocs and sweets even from September, as people anticipate the holidays and start early on to buy seasonal confectionery, for example.
Consumers will also buy the same chocs more than once – a tin of sweets for Christmas in October that will inevitably have disappeared by November and be bought a second time in December.
Apart from that, it is probable that sceptics are underweighting the public’s desire to cheer themselves up on the cheap, for which the double-header of footie and festive cheer is the perfect answer.
So, instead of thinking either/or for Christmas and the World Cup, hedge bets by promoting both in store, and try to make enthusiasm for one feed the other.
As Murphy pointed out, Tesco is planning special signage in stores to draw customers’ attention to football celebration products and offers. This will be separate from the dedicated Christmas products section.
Keep your sleigh full
The opportunities for local independent retailers multiply as Christmas comes closer.
Already we are hearing about how grocery delivery or collection slots for the festive season are likely to all be booked up well ahead of the festive season. When the ongoing supply chain difficulties are also taken into consideration, the number of distress and impulse purchases from disappointed supermarket customers will doubtless be high. Popping out to the local store – there to discover the unobtainable apple sauce or Christmas crackers and wrapping paper long sold-out at Sainsbury or Tesco – will inscribe the convenience channel in shoppers’ memories as the benevolent saviour of the season.
Research by Retail Economics on how retail sales will fare this Christmas showed that retail sales by volume will be down year on year in the final quarter of 2022. However, high inflation currently the value of sales is predicted to rise. The Superdrug chain has just announced a 219 per cent sales uplift of Christmas-related skus compared to this time last year – and November is only just beginning.
In other words opportunity for profit remains, but make sure you are stocked up, and also merchandised in the most enticing manner.
The complexion of gifting is likely to change this year as the cost-of-living increases really bit. Recent research discovered that as many as 46 per cent of UK consumers think they will spend less on traditional presents this year, especially luxury brands, as funds are diverted to essentials.
However, this could prove advantageous for the C-channel as the range of Christmas items traditionally stocked by independent retailers, such as drinks, snacks, chocolates and alcohol, are substituted as gifts.
Do not neglect ordinary groceries when it comes to merchandising for Christmas. Many everyday items take on a special significance at Christmas and oversell during the festive season.
Think about nut & dried fruit displays including shelled and un-shelled nuts, raisins, candied and glacé fruit chinks and pieces, dates (especially Medjool dates), Chestnuts, and pistachio and peanut packs. Shoppers buy all these in greater quantities in the lead-up to Christmas
Likewise fruit baskets, exotic fruits and traditional treats that sit in Christmas stockings – such as easy-peeler mandarins (one of the great, evocative smells of Christmas) should be placed front and centre as a “cornucopia cue”.
Photo: iStock
Stuffing, sauces and helpful convenience packs of vegetables can attract harassed cooks looking to cater for large families, so don’t think beans and brussels sprouts are unglamourous – on the contrary, they are the essence of Christmas just as much as Toblerone and Quality Street!
Cored Pineapples, Cubed Butternut, Microwave Green Beans, Pomegranate Arils, cut vegetable bags, Vegetable Spiral Noodles and pre-ordered fresh cut fruits and vegetables will sell well all month, especially right before Christmas and New Year’s Day. Are you prepared to have these incremental sellers in stock? Don’t forget the Fresh Salsa!
This potential success will be determined by availability and visibility – so turning the store into Santa’s grotto will help send the message that everything needed for merry Christmas can be found without having to travel very far (and waste precious gasoline!).
Last year, according to Nisa, almost a quarter of shoppers planned to spend a bit more on food and drink this year to ensure that Christmas Day, Boxing Day and even New Year’s Eve were extra special. That was after the pandemic restrictions were (almost) lifted. This year, free of all restrictions, but restrained by inflation, the home fires with friends and family are looking more welcoming than ever.
So, remember: Don’t delay – It's Christmas today – at least in terms of stocking up, as customers start their seasonal spending from September onward and are now going full steam for Santa.
North East Lincolnshire Council Trading Standards team have seized over £100,000 of illicit tobacco products during operations throughout Stoptober, the council stated on Wednesday (13).
The team and partner organisations such as Humberside Police uncovered 28,120 cigarettes, 12.45 kilos of tobacco and 3133 illegal disposable vapes in a number of shops during the four week operation. The products have an estimated value of over £100,000.
Shops and businesses on Freeman Street, Cromwell Road, Yarborough Road, and Second Avenue on the Nunsthorpe estate were all visited. The raids were part of Operation CeCe, an ongoing intelligence-led operation, targeting counterfeit and illicit cigarettes, tobacco and illegal disposable vape dealers.
Since January 2021, North East Lincolnshire Council Trading Standards team have seized 84,957 packs of cigarettes, 10,750 pouches of tobacco and over 17,000 illegal vapes, with a combined value of almost £1.8 million, all money which would have gone out of the local economy and into the hands of organised crime gangs.
Humberside Police’s Neighbourhood Policing Inspector for Grimsby West Claire Jacobs said: “We deployed our teams in support of North East Lincolnshire Council during this important operation to combat illicit cigarettes and tobacco within North East Lincolnshire.
“We continue our commitment through the Clear Hold Build initiative to ensuring that Grimsby remains a fantastic place, and working closely with partners on operations such as this one helps us to do exactly that.”
By law, Vapes should have an internal tank capacity of no more than 2ml, and the level of nicotine contained in the vaping fluid should not exceed 20mg/ml (or 2 per cent). As with tobacco products, these items are required to display certain health warnings and every such device, and the liquid it contains, should be registered with the MHRA (Medicines and Health care products Regulatory Agency) prior to being released onto the market.
Councillor Ron Shepherd, portfolio holder for safer and stronger communities, said: “This joint operation shows just how important it is to work together. Multi-agency operations such as these are keeping these products, that do not meet safety standards and are putting lives at risk, off the streets. We know illicit and fake cigarettes do not comply with the Reduced Ignition Propensity requirements and won’t self-extinguish, so are likely to start a fire.
“When you buy these products, you could be putting your own health at risk. Not only has no duty been paid on them but they’ve not been tested to ensure they’re safe. It is important to remember that whilst legitimate disposable vaping bars can be a very useful aid to smokers who are wanting to quit, they still have potential health issues as a result of use, and should never be purchased and used by non-smokers”.
Speaking about quitting smoking, Cllr Stan Shreeve, NELC Portfolio holder for Heath, Wellbeing and Adult Social Care, said: “I urge smokers in our region to use the support services on offer to help them to quit smoking.
“We have so many examples of people turning their lives around completely after quitting smoking with support from the Wellbeing Team, and you only have to look at the figures released today to see what a positive impact that could have for everyone.”
Britain's Premier Foods reported a 4.6 per cent rise in half-year revenue, driven by continued growth in its grocery business and brands such as Mr Kipling, Nissin and The Spice Tailor, shows the results reported today (14).
As UK inflation eased during the first half of the year, consumers who had been cautious about non-essential spending began to loosen their purse strings. That bodes well for food manufacturers who aggressively hiked prices at the peak of a cost of living crisis over the past few years.
Pricing on average is lower than last year, CEO Alex Whitehouse said in a media call, adding that the lower pricing has led to strong volume growth for the group's grocery and sweet treats businesses.As spending trends change and in the lead up to the key Christmas season, some food manufacturers are offering temporary discounts to attract more customers.
Premier Foods said it was on track to meet full year expectations but does not give actual figures. Analysts expect revenue of 1.15 billion pounds and adjusted pre-tax profit of 161.9 million pounds for the year ending March 30, according to a company-compiled consensus.
However, volume trends are expected to normalise and per unit prices are expected to be flat compared to a year ago, rather than lower, Whitehouse said.
Premier, which makes products ranging from plain flour to cooking sauces and quick meals, reported headline revenue of 498.7 million pounds for the 26 weeks ended Sept. 30, up from 476.7 million pounds a year earlier.
Whitehouse said, “We’ve delivered another really strong branded performance in the first half, underpinned by double-digit volume growth.
"This demonstrates the success of our proven branded growth model which was also supported by sharper promotional pricing. We gained both volume and value market share, outperforming the market as many consumers switched into our leading brands from own label. Our innovation programme continues apace as we brought many new products to market in the period, including Sharwood’s curry kits, Mr Kipling Loaf cakes and Loyd Grossman Pesto.”
“As inflation has begun to ease and shoppers are starting to feel more confident, we’ve seen consumers treat themselves more, helping sales of both Mr Kipling Signature Bites and Ambrosia Deluxe more than double in the first half of the year. We’ve continued to make very good progress against all the pillars of our growth strategy.
"We accelerated capital investment in our supply chain, continuing to invest in projects to improve automation and increase efficiency, in addition to enabling growth through new product development. Angel Delight ice cream and Ambrosia porridge pots contributed to strong progress in our new categories, which grew 67 per cent, while the international business performed very well, with revenue up 31 per cent.
"We continue to be very pleased by the progress of our acquired brands, The Spice Tailor and FUEL10K and we now have the biggest selling granola product on the market.
“As we look to the second half, we have exciting plans in place across all our brands, with our best ever Mr Kipling Signature mince pies benefitting from expanded distribution. With this, and our continued branded momentum, we are on track to deliver on expectations for the full year. As we look further ahead, we expect revenue growth to continue to be generated from our strategic priorities of growing our UK branded core, extending into new categories, overseas expansion and M&A activity.”
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Eco Vape partners Aspire to launch new hybrid vape product with 3500 puffs
Eco Vape partners Aspire to launch new hybrid vape product with 3500 puffs
Over a third of UK of vapers will defy any new flavour restrictions brought in under the Tobacco and Vapes Bill, a poll by campaign group We Vape has found.
Commissioned after the bill's first reading in parliament, the poll showed 35 per cent of a 601-strong sample group of vapers across the UK would continue to buy flavoured vapes online, abroad or elsewhere if flavours were limited to only "tobacco", "menthol", and "fruit'.
With 5.6million vapers in the UK, that equates to nearly two million of them (1.96million) buying unregulated products if flavours are restricted.
Research has shown flavours are a significant draw for smokers looking to switch to vaping, an accepted safer way to use nicotine.
And while moves to ban flavour names specifically aimed at children – like candy floss and bubble gum – are widely welcomed, campaigners warned excessive restrictions would drive people back to cigarettes.
"Our polling shows millions of vapers are just going to ignore any measures that prevent them from accessing the flavours that help them quit smoking," said We Vape founder Mark Oates.
"If a certain vape flavour stops a person lighting up, it should be protected. Naming products in a way that clearly appeals to children, like bubblegum, must of course be banned, but there are many flavours that attract smokers looking to make the switch away from the tastes and smells associated with smoking.
"Appealing flavours must be protected to ensure we don't see a mass migration from vaping back to combustible tobacco, which is a death sentence for most users."
The poll, carried out by researchers from Britain in Focus, also showed a quarter of UK vapers would be much less likely to vote Labour if the Government restricts vape flavours.
It means 1.4million of the 5.6million vapers in the country will be lost potential voters for the party, already embattled over a tax-ramping budget and declining voter support.
Results showed that 23.3 per cent would be "much less likely" to vote Labour, while 4.5 per cent said they would be "somewhat less likely" if done as part of the new Tobacco and Vapes Bill.
Mr Oates said: "The vape vote is becoming increasingly important due to the sheer numbers of smokers who have switched to this effective harm reduction tool.
"Keir Starmer is garnering a reputation for not listening to the public. If this continues with vaping the stats are clear – it will cost him at the polls."
Worryingly, poll results also showed one fifth (20 per cent) of vapers will likely go back to smoking after any flavours ban – slightly lower than the government's own impact report.
Asked how likely they would be to return to cigarettes in the next 12 months if the Government were to restrict vape flavours, 11.5 per cent said they would be “highly likely” to go back to smoking while a further 10 per cent said they would be “quite likely”.
This could mean around 1.1 million vapers returning to cigarettes.
Of further concern, 4.8 per cent of vapers – which would equate to around 270,000 people – even stated they would make their own to circumvent any restrictions and save money after the e-liquid tax hike of £2.20 per 10ml of e-liquid.
Mr Oates said: "This government must understand smoking is most prevalent in low income households and communities.
"Keir Starmer has already announced the vape liquid tax will be increased, almost quadrupling its price, which lessens the appeal of making the switch from smoking.
"Our research now shows some people feel so strongly about further restrictions they would consider making their own vapes.
“Removing a product does not remove its demand and with so many people prepared to use illicit products, the government must protect crucial flavours or face the uphill struggle of trying to uphold laws that are impossible to enforce.”
The We Vape poll results should also worry Trading Standards, who will be tasked with enforcing the disposable vapes ban from June next year and tackling a street black market predicted to skyrocket when the new laws are introduced.
The government's disposables ban has been at the centre of some controversy, with its own impact assessment concluding it would likely lead to “health disbenefits.” It stated “29 per cent of current [vapers] will either revert/re-lapse to smoking tobacco” leading to a rise in “the sale of tobacco goods”.
In some good news for the Government however, the We Vape poll showed an overwhelming majority of the country backed a retail vaping licence – with 80 per cent supporting the move that is intended to help crack down on vapes being sold to children.
In a sample of 2400 people across the UK, 85 per cent also supported the introduction of premarket testing, to help keep illicit products off the shelves.
Shoppers are saving on grocery essentials to be able to afford treats and indulgences during Christmas while the festive time is expected to see a boost in sales of premium private label food and drink as more people "dine at home" , shows recent industry data.
According to total till data from NIQ, sales growth in UK stores stores slowed to 4.0 per cent in the four weeks ending 2nd November, down from a 4.7 per cent rise in the previous month. The research firm suggested that this is likely due to shoppers holding back their spending in anticipation of Black Friday at the end of the month and the upcoming Christmas festivities.
Despite easing inflation, shoppers were still cautious with their grocery shop, with spend per visit down 6 per cent on last year at £18.67. They also remained savvy with how they spend, with sales of items on promotion increasing from 24 per cent to 25 per cent. NIQ noted that 36 per cent of branded sales came from promotions – up from 35 per cent a year ago – with brands heavily reliant on deals to deliver volume growth.
Meanwhile, confectionery (+10.5 per cent) was the fastest-growing category last month as shoppers stocked up on sweets for Halloween and Christmas. However, shoppers reigned in on essentials with subdued value growth in the packaged grocery category (+1.7 per cent) and a decline in unit growth (-0.8 per cent).
Moreover, despite an increased level of promotions, shoppers cut back on purchasing beer, wine and spirits with a unit sales decline of 0.4 per cent – a sign that shoppers are holding back until nearer the festivities. NIQ pointed to a recent Homescan survey showing that price reductions and promotions are almost expected by consumers ahead of Christmas. The most popular are retailer vouchers with money off (24 per cent, up from 17 per cent last year) and product promotions (35 per cent, up from 29 per cent last year), which are the key factors considered by shoppers when choosing their Christmas store.
The data also shows that the cautious consumer sentiment has put pressure on general merchandise sales in supermarkets, with value down 1.4 per cent and volumes falling 5.5 per cent.
Mike Watkins, NIQ’s UK Head of Retailer and Business Insight, said, “Total Till sales over the last four weeks have slowed, with shoppers pulling back their spend. Shoppers so far have been cautious, and it’s evident that they are saving on grocery essentials to be able to afford treats and indulgences.
“However, the start of the Christmas advertising campaigns is an opportunity for brands and retailers to entice consumers and showcase what’s new and what’s different. And given that it’s possible that many shoppers will ‘dine at home’ more in the next few weeks, we expect this to boost sales in premium private label food and drink, which NIQ expects to do very well this Christmas.”
Walkers Chocolates said it is switching its popular own brand Turkish Delight and Mint Cream chocolate bars into EvoPak RCM, a 100% recyclable paper wrapper.
The bars will begin rolling out to selected Premier and Asda stores this month.
Unlike conventional paper packaging which often contains polyethylene, consumers can dispose of the new Walkers’ wrapper in their normal kerbside recycling collection along with their other paper recyclable items. Currently, it is only possible to recycle similar wrappers by returning them to store, which isn’t convenient for consumers and in many cases, where recycling processes aren’t carefully controlled, the wrapper still ends up in landfill or incinerated.
Significantly, if littered, the new wrapper does not produce harmful microplastics when it breaks down which cause serious damage to the environment and animal health.
Walkers Chocolates said the new paper wrapper provides a functional and environmentally friendly alternative to current snack and confectionary packaging which, over the past 30 years, has become complex with the development of light weight multi-layer structures.
This has driven efficiency and shelf life, but the complexity makes them impossible to deal with at end of life. This is compounded by consumer consumption, which is often on the move, making littering a bigger problem than other formats. The other factor is that small units using a complex combination of materials makes recycling and recovery options currently limited, resulting in landfill with no circularity option.
“At Walkers Chocolates, we have a strong focus on sustainability and are committed to reducing our impact on the environment. As part this, we will move away from plastic to paper-based materials completely over the next three to five years where possible,” Tom Murtagh, commercial director, Walkers Chocolates, said.
“Today’s announcement is an exciting step for the Walkers team with two our key customers and I hope is the start of a much bigger revolution in the chocolate category, and one which will be welcomed by consumers who can recycle the wrappers and know that no harmful microplastics are being produced at end of life.”
Developed by EvoPak, a manufacturer of sustainable paper based flexible packaging, the new paper wrapper (known as RCM) uses the same environmentally friendly technology as the world’s first fully recyclable crisp packet – the innovative polymer, Hydropol, developed by Aquapak, which is used in place of conventional plastic.
To keep the chocolate fresh and in good condition in transit and on the shelf, the packaging needs to provide protection from oxygen, seal well on standard packaging equipment and must be easy to print on. Hydropol provides all this functionality as well as offering multiple safe end-of-life disposal options for consumers and brands who want to help eliminate harmful plastic pollution.
Hydropol allows paper to remain fully recyclable and compostable and is even compatible with anaerobic digestion. Thanks to its solubility it doesn’t interfere with the recycling process and can allow up to 100% paper fibre recovery in standard mills.
Furthermore, if unintentionally released into the natural environment, Hydropol – which is proven to be both non-toxic and marine safe – still has a safe end-of life and will dissolve and subsequently biodegrade. It does not break down into harmful microplastics either in the paper mill or if packaging it is not disposed of as intended. It is already being used in products such as crisp packets, chocolate and garment bags.
The wrappers have been certified as recyclable in standard paper recycling mills by OPRL, the only evidence-based on pack recycling labelling scheme. This means they feature the green recycle logo and can be disposed of in consumer kerbside collections along with other paper material, unlike other wrappers.