Three leading trade bodies and seven food retailers are calling for urgent action to reform the broken Apprenticeship Levy system and address the “critical and persistent” labour shortages in our food supply chains.
In a letter sent to the Government, the British Retail Consortium (BRC), the National Farmers Union (NFU) and UKHospitality (UKH), along with leading UK supermarkets, say reform to the Apprenticeship Levy would allow businesses to train up more domestic workers in order to fill the vital skills gaps, which would “foster greater resilience, support the nation’s food security, and benefit the economy.”
The food supply chain, which includes farming, handling, packaging, retailing and hospitality - has been hit by acute labour shortages in recent years, particularly in areas such as food production and preparation, logistics, warehouse operations and quality control since the UK left the EU and the labour market contracted during Covid. The shortages have meant labour costs have risen, creating yet another inflationary pressure contributing to higher prices for customers.
A reformed Apprenticeship Levy could help plug shortages, but the current system is too inflexible. Businesses are required to contribute hundreds of millions of pounds into a pot, while funds can only be spent in a very restrictive way. For example, businesses cannot use the money to fund any courses that are shorter than one year in duration. This inflexibility has cost the UK many thousands of training opportunities and billions of pounds of potential investment into the British labour market at a time when it is urgently needed.
The trade bodies and food retailers are calling on the Government to widen the Apprenticeship Levy into a broader Skills Levy to allow businesses to spend their funds on a wider range of high quality, accredited courses including shorter, more targeted courses, or more tailored upskilling programmes, including food safety, hazard analysis, first aid and driving farm machinery.
Crucially, these changes would not cost the Government a penny, but by unlocking that funding, food businesses could invest millions more into equipping their workforces with the essential skills and training to respond to the needs of our food supply chains, enhancing food security, and boosting our economy.
Helen Dickinson, Chief Executive of the British Retail Consortium, said, “Why is it that the very system that exists to enable training opportunities, serves as the total opposite? Businesses across the food supply chain have long been calling for reform to the Apprenticeship Levy. The Government should stop dragging its feet so businesses can upskill our workforce, help safeguard food security in the UK, streamline costs and respond to the needs of the economy. The Apprenticeship Levy is nothing more than a tax on business and it must be reformed.”
Tom Bradshaw, Deputy President of the National Farmers Union, said, “For a long time now there has been a clear skills gap in the food supply chain. Unlocking the money that levy payers have not been able to use would be a positive step and could help to provide much-needed flexibility in delivering apprenticeship training.
“Reforming the Apprenticeship Levy is crucial to get young people involved in farming and the wider food supply chain, as well as upskilling those already in the industry.
“We need to find better ways to support our future workforce because those people working within the food and farming sector, worth more than £128 billion to the national economy, will be central to providing quality, sustainable, home-grown food for the nation in the years to come.”
Ken Murphy, Chief Executive of Tesco, said, “Reform of the apprenticeship levy could not only unlock high-quality jobs in our food supply chains, but also help safeguard Britain’s food security for the future. I would urge the Government to look again at the practical barriers to skills development under the current system, because it is not delivering for food businesses or their employees.”
Hayley Tatum, Senior Vice President - Chief People and Corporate Affairs Officer at Asda, said, “At Asda we are incredibly proud of our current apprenticeship scheme and we know that apprenticeships are vital in providing young people opportunities for growth, employment and to build new skills. However, we believe that the current Apprenticeship Levy scheme requires reform to provide greater flexibility in the schemes where the Levy funds can be distributed. Asda would welcome reform that would make it easier for businesses to spend Levy funding as intended – offering new opportunities across the country as well as upskilling the existing workforce.”
A spokesperson at Morrisons, said, “Morrisons currently has more than 600 colleagues on an apprenticeship scheme. Even though we are one of the biggest apprenticeship providers in the country we are still unable to spend the bulk of funds we contribute to the apprenticeship levy. Reform is needed to offer businesses more flexibility in how levy funds are used, which would unlock millions of pounds and open up additional training opportunities for people in a broader range of courses.”
Brewer Carlsberg is shifting some of its marketing focus to cheaper brands, it said on Thursday (31), as consumers in major markets bought cheaper beer and in reduced quantities.
The maker of Kronenbourg 1664, Tuborg and Somersby said beer sales volumes fell by 1.3 per cent in the third quarter, noting declines in China, France and the United Kingdom. Premium sales fell 0.5 per cent in the quarter."In Western Europe, there's no doubt that the average consumer is holding back," CEO Jacob Aarup-Andersen told Reuters.
"In Asia, China stands out as a market where the consumer is very weak. Most other Asian markets are actually okay," he said, adding the company had not yet seen Chinese stimulus measures having any impact on consumer behaviour.For years, brewers have relied on a strategy of developing and promoting their more expensive premium brands to offset an overall decline in drinking.
Aarup-Andersen said he remained confident in the long-term growth potential of premium beer and that the category will comprise a significantly larger portion of Carlsberg's business in a decade.For now, however, the company is adjusting its marketing.
"In markets where we are seeing a significant pressure on premium, we are reallocating some of our focus into making sure that we are promoting properly around the right mainstream brands," he said.
The world's third-largest brewer behind Anheuser-Busch Inbev and Heineken said third-quarter sales rose 1 per cent to 20.5 billion Danish crowns ($2.98 billion), compared with 20.7 billion expected on average by analysts in a poll gathered by the company.
Despite the shift in consumer behaviour, Carlsberg said it still expects full-year organic operating profit growth to be between 4 per cent and 6 per cent. The company lifted its full-year guidance in August.
Also on Thursday (31), the world's largest beer maker Anheuser-Busch InBev reported third-quarter profits, revenues and volumes behind forecasts. AB InBev's third-quarter statement highlighted stronger growth for its more expensive beers, like Corona, which grew 10.2% outside of its home market, Mexico, during the period.
Consumers now want a greater commitment from retailers in cutting food waste, refilling stations, sustainable packaging, and partnering with social purpose organisations, states a recent research, which also highlights that a good majority (69 per cent) of younger consumers are more likely to shop with what they see as socially responsible retailers though price sensitivity still plays a crucial role.
According to the findings, published in Vypr’s Consumer Horizon Report, reducing food waste is the most important factor for the majority of UK consumers (29 per cent), especially for Gen Z women aged 18-24 (38 per cent). More than a third (37 per cent) of men aged 18-24 said they needed food storage advice. A similar number of women aged 18-24 (33 per cent) want meal kits with the exact amount of ingredients included for them to cut down on food waste.
Refill stations for personal care, cleaning products, dry goods, and beverages are also in high demand. Consumers, particularly Gen Z women, are keen to use these stations, provided they offer a cost-saving of 6-10 per cent compared to packaged goods. The study indicates that older shoppers are less likely to use refill stations unless prices are reduced by 15 per cent or more, which Vypr said shows the importance of price in driving consumers to adopt sustainable shopping habits.
The third priority for brands and retailers is to adopt sustainable packaging. Awareness of eco-friendly packaging is high, especially among younger generations. Two-thirds of UK consumers say they expect to pay more for sustainably packaged products, and that figure rises to 86 per cent among Gen Z and Millennials. However, Vypr’s research suggests that while shoppers express willingness to pay more, price sensitivity still plays a crucial role.
Ben Davis, founder of Vypr, said: “There’s often a disconnect between consumer intentions and actions. Brands need to understand that simply offering sustainable options may not be enough if price points don’t match consumer expectations.
“For Gen Z and Millennials, sustainable products need to be competitively priced or risk losing long-term loyalty. We tested this by presenting products with and without the label ‘100 per cent Recycled Packaging’ and found price remained the key purchase decision-making factor for most consumers.”
Another factor in building loyalty among younger consumers is to showcase social responsibility. The research reveals that 60% of shoppers are more likely to shop at retailers that partner with food rescue organisations or promote a charitable cause. Among Gen Z and Millennials, this figure jumps to 69%, showing a strong preference for brands that demonstrate a social purpose.
The report also reveals that 85% of shoppers are willing to pay a deposit for reusable products, though it is younger consumers, particularly those aged 18-24 who express the strongest support for such initiatives.
The Consumer Horizon report which provides insights shaping retail, product innovation, and consumer behaviour going into 2025, can be seen here.
Sugro UK, the number one buying and marketing buying group*, in partnership with b2b.store, is thrilled to announce a further expansion of its existing E-Loyalty scheme programme, which has proven to be very popular with its members and retailers, by introducing E-Loyalty Extra Compliance and Execution scheme as well as E-Coupons.
The E-Loyalty Extra is aimed to boost compliance and execution at retail store level to drive new product launches, core range compliance, some exciting fixture trials with its supply partners and more! It will be available to all member owned and member affiliated retail stores within the group.
The E-Loyalty Extra loyalty scheme will be accessible by retailers via WhatsApp platform and will allow retailers to capture evidence of compliance by simply clicking “take photo” button.
With the addition of another digital enhancement introduced to the group recently – Coupon - based loyalty mechanic, members are now empowered to incentivise and reward customers, driving stronger consumer connections and fostering brand loyalty at a granular level. Retailers can now simply redeem a coupon at the point of check out. Another key digital development within the group is WhatsApp E-Presell which enables Sugro UK’s retail partners to provide advance product volume commitments for new product launches. This functionality is particularly powerful as it ensures that suppliers have accurate forecasts before product launches, enabling better stock availability from day one of product being available on the market.
The ease and speed of using WhatsApp for these commitments simplifies the presell process, ensures accuracy and strengthens relationships across the supply chain.
While other industry players may soon consider introducing similar digital tools, Sugro UK are proud to be at the forefront of enhancing retail-focused digital solutions. This early adoption not only ensures that Sugro UK members remain competitive but also guarantees them access to the best digital tools available in the market. These efforts are part of Sugro UK's ongoing commitment to delivering value to its members and empowering them with innovative solutions for growth and success in an increasingly digital retail environment.
Sugro Head of Commercial and Marketing, Yulia Petitt said: “I am delighted that Sugro UK members are now able to provide photographic evidence of retail compliance and in-store execution to our supplier partners, using a wide range of display and compliance criteria such as planograms, secondary displays, trials, and new product developments (NPDs).These digital features allow members to share real-time proof of execution, enhancing accountability and building supplier confidence. The launch of E-Presell functionality opens a huge digital advantage for the group which will benefit all – members, retailers and suppliers in gaining accurate forecast and ensuring product visibility in store from day one of product being on the market and with the ease of using WhatsApp, the entire pre-sell process becomes a much quicker and easier process to manage for all parties.
"The Group has had 18 consecutive years of growth and, once again, on track to deliver in 2024, with the year-to-date performance of +15% year on year and growth across all categories.” Rob Mannion, CEO of b2b.store, added: “The rate of innovation in the wholesale sector is increasing and these launches are further great examples of that. We’re particularly excited about the developments and different uses of WhatsApp in the industry, with more coming in the pipeline for 2025 – it’s a tool no wholesaler or buying group can afford to ignore because of the level of influence it’s having in the sector and there’s no sign of that direction of travel changing any time soon.”
Sugro UK is proudly owned by its 90 plus independent wholesale members, with a combined turnover of over £2.5 billion.
Expanding its footprint in the World Foods category, Paulig has acquired Panesar Foods, a prominent UK-based producer of sauces and condiments.
Founded in 1992 and headquartered in Tipton, Panesar Foods is a family-owned business with three production facilities, employing 308 staff and achieving a turnover of £59 million in the 2023 fiscal year.
This collaboration is expected to accelerate product launches and drive growth in diverse offerings, including sauces, salsas, marinades, dips, and condiments.
"We have collaborated with Panesar Foods for 17 years, and we are very pleased to welcome the company to Paulig," said Rolf Ladau, CEO of Paulig. "Today, our combined taste expertise and innovation skills unite around a shared ambition: to accelerate our international growth and expand our World Foods offerings."
Bill Panesar, CEO of Panesar Foods, expressed confidence in the partnership, stating, “As Panesar Foods becomes part of Paulig, I am confident that our ambitions for international growth will be realised, and the business will continue to thrive. We share a strong commitment to innovation and delivering high-quality, flavourful products, and I look forward to bringing even more delicious products to the market, together."
Jas Panesar, MD of Panesar Foods, echoed, “This partnership will allow us to reach new markets and deliver our authentic World Food flavors to a broader audience. We look forward to combining our passion for quality food with Paulig’s commitment to sustainability and innovation.”
All 308 Panesar employees will transition to Paulig’s team. Financial details of the transaction remain undisclosed.
Labour MP Mary Glindon has cautioned that a new excise tax on vaping could discourage smokers from switching to less harmful alternatives.
Glindon, who also chairs the All-Party Parliamentary Group for Responsible Vaping, said the chancellor’s proposed tax, which will add £2.20 per 10ml of vaping liquid when it goes into effect on October 1, 2026, will “hurt working people”, who rely on vapes to quit smoking.
“A tax on vaping will only serve to discourage smokers from quitting,” the Newcastle upon Tyne East and Wallsend MP said during a Commons debate on the Budget.
“The tax will also hurt working people … who rely on vaping to keep them off cigarettes.”
Glindon termed the 22p per ml tax as “unsustainably high,” highlighting that it will create one of the highest vaping duties in Europe.
“Currently, many stores sell vaping liquid for refillable devices for 99p. Under the chancellor’s proposals, that will increase by 267 per cent to £3.64,” she added.
Glindon dismissed suggestions that low-cost vaping liquids drive youth vaping, pointing instead to the upcoming Tobacco and Vapes Bill aimed at curbing youth access.
“I fear that the tax on vapes will hurt people who have made the decision to switch from smoking to the less harmful alternative—a decision that has already saved the NHS tens of thousands of pounds per person,” she noted.