From mobile to FDA rules for food labeling and tobacco, NACS shares the latest trends and information with convenience store retailers.
By Erin Rigik, Senior Editor
The National Association of Convenience Stores (NACS) Show kicked off in Vegas on Oct. 11 at the Las Vegas Convention Center with a number of educational sessions.
In an educational session on Sunday, Oct. 11, about the new menu-labeling laws that will take effect on Dec. 1, 2016, Doug Kantor, partner, Steptoe, walked attendees through how to navigate the labeling challenges.
Companies with 20 or more establishments of the same name must comply with the rules even if those establishments have different owners—such as in a franchise situation—if they have similar food sold at each establishment, with the same “general recipe,” prepared in “substantially the same way.”
A fast food company inside your convenience store, that is separately branded, such as Subway, would be an independent facility, but Kantor cautioned that c-stores should be careful in the contract about who is liable for what.
Restaurant-type food that customers eat at your c-store or soon after must be labeled with calorie counts. This doesn’t apply to groceries, such as a box of cereal.
Kantor noted if there is nutrition info on packaging retailers are most likely OK— customers just need to be able to see this information before they buy the product. Standard menu items are required to have calorie counts, but temporary items—available less than 60 days a year—or market test items available less than 90 consecutive days don’t need calorie counts.
Toppings must have calorie counts listed, but not condiments. Toppings that are added to an item by you at the customer’s order or things on menu—things you charge for—must provide calorie counts.
Condiments, meaning free additions for customers that are not listed on the menu and that customers put on themselves don’t need to have calorie counts listed. This also goes for the cream and sugar at the coffee bar, assuming customers are preparing it themselves. But if you are putting the condiments on for them, those will need to comply and be on the menu.
Calorie counts must be no smaller or less conspicuous than the item or price. Combination meals must be labeled and in some cases, calorie counts must be placed on advertisements too depending on store layout and if a customer could reasonably see an advertisement and order from it. When it comes to food on display, the menu board must be where customers can see it when they order, or the products must be labeled so customers can see it when they order.
Kantor took audience questions about various situations and ways to best comply with the mandate.
Retailers must calculate nutrition information, on a “reasonable basis” such as using nutrient databases, cookbook, lab analyses, nutrition facts on labels on packaged foods, other reasonable means.
Kantor urged retailers to document exactly how they determined calorie counts and keep it handy to show the Food and Drug Administration (FDA) should they come knocking.
Mobile Is Here
In a session on Mobile Payment Solutions, Ed Collupy, executive consultant for Capra consulting firm, noted that adding mobile goes beyond just adding an app. It means providing a customer experience from forecourt information to digital offers, potentially beacon technology, ordering ahead and so on. Other channels are changing and c-stores need to pay attention. He urged retailers to look at Amazon Fresh, Uber, Instacart, Dominos and others who are currently shaping customer expectations in the mobile space. At Starbucks, customers can order ahead and their latte is waiting when they get there—so the definition of convenience is changing too.
As c-store retailers begin to add mobile, having a team of cross functional employees—those who can bring operational considerations, the marketing message, financial objectives and a great customer experience together and troubleshoot problems ahead of time is key to a rolling out a smooth mobile solution.
Doug Rodewald, partner with W. Capra pointed out that the tipping point for mobile is here, with 95% of smartphone users now using an Android or iOS. He noted that this is the ultimate time to be having discussions about mobile payment, what type to accept, how to accept and when. “Mobile is more than an app. You have to start thinking of it as a channel. When we think about mobile, think more broadly, such as how to introduce this channel for communication, payments and engagement,” he said.
“Mobile is all about data. Your operating model will become more complex so plan for it. Bring the team together, have marketing own it and understand how data will be orchestrated in background,” Rodewald said.
In a session titled, “Vapor Smoke and Mirrors: Making Sense of FDA Tobacco Regulations,” Mary Szarmach, vice president trade marketing & government relations, Smoker Friendly Int.; Lyle Beckwith, senior vice president government relations for NACS; Mitch Zeller, director Center for Tobacco Products (CTP), Food and Drug Administration, United States Department of Health and Human Services; and Thomas Briant, executive director of the National Association of Tobacco Outlets (NATO) participated in a panel on what’s ahead with tobacco regulations.
Zeller outlined strategic priorities for the FDA. On April 24, 2014 FDA proposed a rule that would extend CTP’s authority to cover additional tobacco products, including electronic cigarettes.
FDA is exploring standards for addictiveness, toxicity and appeal, along with a comprehensive FDA nicotine policy. “It’s time to look at nicotine differently,” Zeller said, adding FDA recognizes there is a continuum of nicotine-containing products and that people smoke for the nicotine, but die from the tar. Therefore the agency is looking into an integrated FDA-wide policy on nicotine-containing products that is public health based.
FDA has conducted over 495,000 inspections at retail stores in 56 different states and territories and issued over 34,000 warning letters and over 4,900 civil money penalty actions against retailers. It has published guidance on how it would issue a no tobacco sale order in the event a retailer has multiple violations where they would need to stop selling tobacco products for a length of time. “We published final guidance, so that puts us one step closer to being able to issue a no tobacco sale order,” Zeller said.
FDA continues to work to educate retailers. In 2016 new educational materials now being developed will be distributed to tobacco retailers. Materials will further educate retailers on how to comply with FDA regulations in retail locations.
The landscape for tobacco continues to rapidly evolve. The final deeming rule will require cooperation and communication on many new provisions.
FDA is also going through the process of regulating tobacco products sold on tribal lands. Thus far, the process is in place at two Native American reservations and inspections have started at one.
On the topic of youth smoking, Briant pointed out that often adults purchase tobacco products for minors and asked if FDA was doing anything to address this issue.
“Social forces of tobacco products is a problem and an indication that as a society we have more to do together to de-normalize tobacco use so a friend or sibling understands the harm being done by providing a tobacco product to a minor. We have started including social usage in our planning…” Zeller said.