“Unprecedented” period impacting wholesale
General elections and referendums slow legislation affecting wholesalers, but there’s still plenty going on
It’s been an unprecedented few years in the political arena. Two general elections, two referendums and the prospect of the most significant change to our economy in a generation have all helped to slow the progress of legislation that affects wholesalers and their ability to provide great service and support to their customers.
However we are now in a period of relative stability, even as Brexit dominates the Government’s time and resources. We are starting to get a clear picture of the issues which will impact on our sector, and where FWD as the representative voice of the industry needs to make sure our voice is credibly heard.
The Deposit Return Scheme for plastic bottles came a step closer with an agreement to take it forward in Scotland, and Defra Minister Michael Gove’s support for a similar scheme in England leading a consultation in its introduction in England and Wales. I doubt there’s a single wholesaler that doesn’t support the intention of reducing litter and improving recycling rates, but the detail of the scheme needs to be examined carefully so that FWD members don’t end up carrying an unfair burden in the journey towards a desirable destination.
We also have work to do on the implementation of the Soft Drinks Levy. Our concern is that a levy imposed on sales within the UK makes imported goods more attractive to those wholesalers who are looking for an opportunity now AWRS has excluded them form the alcohol market. Having raised the issue with HMRC, we’ve won an amendment to the regulations which makes the person bring the goods into the UK the “first seller”, and therefore liable for the levy, rather than the retailer or distributor who sells it to the public. This is an important step towards tackling a potential new route for fraudulent operators and is good news for law-abiding wholesalers.
The EU has recently published its plans for ‘track and trace’ of tobacco products, which would require identifying marking on all packs of cigarettes and hand rolling tobacco from May 2019. It’s a major change with potentially huge implications for wholesale. It looks like the proposals may stop tobacco sales on cash and carry day passes, for example.
On the transport side we have new proposals to extend the Ultra Low Emission Zone in London, a move which would exclude some of our current distribution fleet from the city centre. Again, a clear air policy is not something anyone would want to contest, but our job will be to ensure there’s a balance between the desired outcome and the practicalities of delivering it. London’s Mayor is also keen to involve food distributors in his Health Inequalities Strategy, which includes in its proposals a move to limit the development of hot food outlets near schools, as well as working with wholesale to look at portion sizes in foodservice as a way of tackling obesity.
Articles of Association
Inform the CMA inquiry
While FWD is bound by its Articles of Association not to comment on changes to the market involving our members, we are well aware of the depth of feeling about the possible merger of Booker, our largest member, and Tesco. Our role is to use our market statistics and research about the wholesale market to help inform the CMA inquiry so any conclusion they reach is made with full understanding of the sector.
And then there’s Brexit. It’s our job to read the Government’s position papers so you don’t have to. On borders, on customs regimes, on free movement of goods and labour, FWD is the point of contact with the officials charged with carving out new structures that work for everyone, and we’ll ensure that wholesale distributors’ voices are in those discussions.
Talk to any of the older heads in our industry and they’ll tell you that change is permanent. Technology advances, supply chain efficiencies and consolidation between players has always been a feature of our sector, and will remain so. While the current legislative agenda contains some new challenges, if we pool our knowledge, experience and energy we will identify opportunities for growth, and evolve to meet them as we always have.