It’s true that summer means ice cream, but with a wealth of great NPD and flavours, the sector is looking to make indulgence a year-round thing
Last year, ahead of National Ice Cream Day (yes, it exists), a certain UK supermarket released some figures revealing key and ongoing ice cream trends. Classic flavours such as vanilla, chocolate and mint chocolate chip were still the best-loved flavours, with “sundaes at home” and “salted caramel” as absolutely a la mode.
According to research it had carried out, the nation displayed a continued liking for classic flavours, with vanilla (42 per cent), chocolate (32 per cent) and mint chocolate chip (29 per cent) taking the top spots. On the other hand, once-beloved flavours (or combinations) like Neapolitan seemed to have lost their charm and remained the ice cream of choice for only 11 per cent of the nation.
When enjoying ice cream at home, nearly half (45 per cent) of ice cream enthusiasts preferred to savour the treat in a bowl, while just over a quarter (29 per cent) opted for the classic cone. Surprisingly, one in four people (25 per cent) admit to indulging in their ice cream straight from the tub, embracing a casual and carefree approach.
Nevertheless, the filled-cone category is growing 7.6 per cent, and Cornetto Soft is outperforming the category at 38 per cent value and 26.5 per cent volume growth throughout 2023, according to Rhiannon Lines, Wall’s Handheld Marketing Manager at Unilever.
Reflecting ever-evolving ice cream trends, Gen Z exhibits somewhat more adventurous preferences. One in ten (11 per cent) of 18–24-year-olds now favour ice cream sandwiches, whilst eight per cent delight in the chewy texture of mochi as their preferred ice cream treat.
“Ice creams are becoming increasingly adventurous, giving rise to new and exciting flavour combinations and innovative textural inclusions. This trend has seen the rise of indulgently nostalgic cookie dough in ice cream,” said Jaimini Sharma, Product Development Manager at Tesco plc.
Photo: iStock
It is true that summer presents a great opportunity for retailers to offset lower sales in other seasons, as although ice cream is enjoyed throughout the year, it is particularly popular during the warmer months. In time, perhaps the UK could adopt the Swedish consumers’ practice of eating more ice cream the colder it gets – and indeed, the industry impetus is currently in the direction of what is called “de-seasonality” and more year-round consumption of ice cream (see below)
The UK ice cream market was valued at £2.46 billion in 2021 and is expected to grow at a compound annual growth rate (CAGR) of over four per cent between 2021 and 2026, according to GlobalData.
“The UK ice cream market tops value sales at £3.4 billion, with wrapped handheld ice cream being the most prominent segment, valued at £1.8 billion,” says Michelle Frost, general manager at Mars Chocolate Drinks & Treats (MCD&T). “Within convenience and convenience multiples, ice cream sales are currently worth £782.2 million, with handheld multipacks also proving to be a successful segment, with sales worth £378 million.”
Nearly 80 million single ice creams were purchased in retail stores in 2022, contributing an estimated value of £120 million to the sector, so ice cream is the second most impulsive purchase after confectionery and should be taken seriously by retailers who wish to up their margins in the holiday season.
Ice cream holds the largest share within the frozen category, accounting for 23.3 per cent. The key categories in the segment include take-home and bulk ice cream, impulse ice cream (single serve), and artisanal ice cream.
Single serves
Wall’s is filling freezers across the UK with new launches of Twister Berry-licious, Cornetto Soft Stracciatella and Caramel, and three new GUUUD Greek Style Yoghurt Ice Cream flavours: Raspberry, Salted Caramel and Passionfruit. (Yogurt ice cream might well be the Next Big Thing.)
Twister has released Twister Berry-licious – the first ice cream in the market with the interesting boast that it naturally colour tongues blue. Made with real fruit juice and no artificial flavours or colours, and at only 68 calories per stick, it is HFSS-compliant and carries Unilever’s Responsibly Made for Kids logo (4 x 70ml multipack, RRP £2.50 and single70ml, RRP £1.40).
“Family favourite Twister is known for its iconic shape and innovative flavour combinations. It is ideal for parents and care givers who want to buy tasty, guilt-free ice creams for kids to enjoy as a treat. Ice cream is all about fun and taste, and what can be more enjoyable than a delicious ice cream that can turn tongues blue – naturally. We’re proud to be able to bring this innovation to the category and expect Twister Berry-licious to get tongues wagging across the country” says Rhiannon Lines.
Meanwhile Cornetto has added another variant to its successful Soft range with Stracciatella and Caramel (4 x 140ml multipack, RRP £3.75). They feature stracciatella and caramel toppings and sauce, and a brand-new crunchy Cocoa wafer cone – a first for the brand.
“Cornetto Soft was designed to enable people to enjoy the world of soft ice cream at home. This indulgent new Cornetto Soft recipe offers a convenient way for consumers to treat themselves and is perfect for the growing sofa snacking occasion,” explained Lines.
To cater for shoppers who appear to be seeking healthier choices across the desserts category, Greek-style yoghurt ice cream GUUUD, is launching three new flavours – an indulgent salted caramel, a sweet and sour passionfruit and a fruity raspberry, all of which treats come in at only 68 calories per stick and all HFSS-compliant (70ml – RRP £1.80, 3 x 70ml multipack – RRP £3.00).
“Innovation is one of the key drivers in the category, and as a leader in ice cream we continue to push the boundaries. GUUUD is a key player in our strategy to de-seasonalise ice cream. Through the brand, we’re creating new all-year-round occasions for ice cream as it offers the perfect alternative to a traditional yoghurt. Whether it’s enjoyed on-the-go, as an afternoon snack or as part of an indulgent moment on the sofa after dinner, GUUUD is designed to unlock new opportunities for frozen treats.”
The Magnum brand, meanwhile, recently unveiled its latest duo innovation – Magnum Euphoria Pink Lemonade and Magnum Chill Blueberry Cookie, offering a multi-sensory experience as it introduces Magnum’s first ever sorbet and ice cream combination. The new flavour combinations are based on the two distinct moods consumers can experience when eating ice cream. For Euphoria the inspiration comes from the emotional state of extreme happiness, while Chill is inspired by the feeling experienced during an emotional state of relaxation. Consumers can choose the flavour that best suits their mood.
Euphoria Pink Lemonade consists of a raspberry sorbet core, wrapped in citrusy lemon ice cream with popping candy and provides consumers with complementary and intense flavour profiles. Magnum Euphoria Pink Lemonade is also being launched in a Magnum Mini format (RRPs: Single £2.20, 3x Multipack £3.99, 6x Multipack Mini £4.50).
Magnum Chill Blueberry Cookie provides a smooth blueberry sorbet core encased in vanilla biscuit flavour ice cream and crunchy cookie pieces. Chill is a vegan ice cream which provides delicious innovation in flavour and also supports Unilever’s sustainability targets through growing plant-based sales (RRP£2.20, 3x Multipack £3.99).
The new SKUs from Magnum follow a successful year for Magnum innovation in 2023 with both Magnum Sunlover and Starchaser ranking as the number one and number two ice cream NPD respectively.
“After two years in the making, we are thrilled to introduce our revolutionary mood-inspired range that offers a multi-sensory ice cream experience thanks to our surprising sorbet core, a Magnum first,” said Daniel Lythgo, Brand Manager Magnum UK at Unilever.
Mars Chocolate Drinks and Treats (MCD&T) last year launched Twix Ice Creams Cones, the first time that this popular confectionery brand has been developed into an ice cream cone format.
Across the overall ice cream market (with the filled-cone category in 7.6 per cent growth), Mars Ice Cream grew by £11.5m in 2022, equating to a 42 per cent share of the total ice cream market growth. Over the last five years, Mars has delivered more than six times the growth of the category average and more than any other manufacturer.
Michelle Frost, General Manager at MCD&T says: “The brand familiarity and price point of Mars products have really allowed us to solidify our mid-market position, and for some of our core brands, the appetite for our classic products has still increased by a third. Developing the Twix brand into an ice cream cone format was a natural progression to give fans of the brands an alternative format to enjoy.”
Frozone!
In addition to Unilever’s bet on yogurt ice cream, over at World of Sweets, Partner Brand Manager Chris Smith says that Freezables are a big trend. They offer retailers a low-cost summer product which customers will grab and purchase to cool down on a warm day. These can be purchased by customers in a multiple pack which they can freeze at home, or one already frozen and ready to enjoy in-store.
“The range of freezable products is growing every year with some exciting flavours from big brands having launched in time for this summer,” says Smith. “For independents it’s about offering low cost, value treats and offering their customers the freezable and ice-cream products they know they’ll enjoy. Offering a varied range of recognisable brands and innovative products is really important to encourage repeat customers.”
World of Sweets have launched new products from PAW Patrol and Warheads which will join the popular Barratt range and existing Warheads freezable products.
“PAW Patrol is the number one preschool brand in the UK, it’s watched by over 350 million households across more than 170 territories and in more than 35 languages,” says Smith. “Its confectionery treats are also popular among younger consumers with fruity flavours and smaller portion sizes.”
New for 2024 are PAW Patrol Freeze Pops in Cola, Raspberry, Tutti Frutti and Watermelon with no artificial flavours and colours. These are available as multipacks. The freeze pops are HFSS compliant meaning they can be stocked as an impulse purchase at the till point.
Barratt Ice Duos were launched in 2022 and were the only ice lolly commended in the Ice Cream and Ice Lolly category at the Quality Food Awards 2022. The multipacks include either Fruit Salad & Dip Dab Ice Duos or Refreshers & Wham Ice Duos. Brightly coloured branding with eye-catching design ensures they stand out on shelf.
“The ice poles can also be purchased by consumers as singles. They’re available in classic sweet shop flavours Fruit Salad, which is raspberry and pineapple flavour and Wham, in sour raspberry flavour. Additionally, they’re suitable for vegans and have no artificial colours and flavours,” adds Smith.
“Freezables from US confectionery brand Warheads are a popular choice for retailers and their customers with the sour flavours and eye-catching branding.”
The Warheads Snap-Ice, launched in 2023, is a two-in-one freezable which sold exceptionally well last summer. Extreme sour fruit flavours include green apple, watermelon, black cherry and blue raspberry.
Carrie Martin, General Manager for Kind at Mars, recommends another kind of freezable: the award-winning US frozen-snack brand, trüfrü which launched into the UK market in March. The brand, which first launched in the US in 2017, has since reached $215M RSV (Nielsen), completely changing the game in the US frozen snacking category. It was acquired by Mars in Q1 2023for its better-for-you snacking portfolio.
Martin says that the launch of trüfrü is timely: with the ice cream category continuing to evolve, bitesize and permissible formats are in rapid growth and the trend for frozen snacking continues to grow. “trüfrü tastes like real indulgence and fulfils a permissible need that we know consumers are looking for in the frozen category,” she continued. “We are excited to be able to bring innovative snacking solutions at pace from the US to UK consumers, in a way that nurtures this fantastic founder-led brand with the scale and capabilities of Mars.”
Combining the yogurt trend and the freezables trend is Frubes, which launched in their frozen form last summer, “We are the only yoghurt brand in a tube and the only one to offer the versatility of being able to freeze,” said Ewa Moxham, Head of Marketing at Yoplait UK. “We are confident that kids are going to love having one of their favourite snacks in a frozen format, especially as the weather starts to warm up. This is also a great way of minimising food waste and making our product last longer.”
Chupa Chups also introduced a frozen version of their brand favourites with Chupa Chups Eezy Freezzy Squeezee Ice Pops in four flavours: Cola, Apple, Strawberry and Orange. They are conveniently packed into an ambient bag format – to be stored ambiently and frozen when required. The assorted bag of 12 x 45ml freeze pops are available from Booker or directly from Rose Marketing UK Ltd. The freeze pops are made with real fruit juice, natural flavours and no artificial colours and they are suitable for gluten free, vegetarian, vegan and halal diets.
Complementing them is the natural-flavoured Strawberry Chupa Chups Eezy Freezzy Triangles, which, as they are a little bigger than the squeezee pops, are perfect for slightly larger appetites. There are eight 62ml triangles per pack and can be found in the main grocery fixture to buy ready to freeze at home. The Strawberry Chupa Chups Eezy Freezzy Triangles are also suitable for vegans.
Relax in an ice-cold tub
When it comes to tubs, Ben & Jerry’s has expanded its Sundaes range with two indulgent SKUs inspired by an iconic American dessert, the “S’more”. Both Marshmallow & S’more and a non-dairy NPD, Oat of this Swirled, feature the S’more’s star ingredient, toasted marshmallow – a top ingredient, according to recent CMI consumer research.
The tub of rich chocolate ice cream is jam packed with chocolate cookie dough chunks and gooey marshmallow swirls, topped with a creamy whipped ice cream, toasted marshmallow caramel swirls and popping candy traceably sourced Open Chain chocolate. The new flavour offers a complete dessert solution and drives consumer trade upwards with uber-indulgence.
“Both brand-new S’mores-inspired ice cream flavours and are fully loaded with cookie chunks, toasted marshmallow-y swirls, topped with a soft whipped top that Ben & Jerry’s Sundae flavours are famous for, and finished off with traceably sourced Open Chain chocolatey chunks – providing more indulgence in every spoonful,” says Flo Howell, Country Business Lead at Ben & Jerry’s UK.
Oat of this Swirled Sundae is the first Non-Dairy ice cream flavour purposefully created with Ben & Jerry’s new oat-base recipe. The burnt sugar Non-Dairy ice cream is loaded with oat cinnamon cookies and toasty marshmallow-y caramel swirls, topped off with a soft whipped top and Open Chain chocolatey chunks.
“Out of this Swirled will be our first flavour made with the new oat-based formula, allowing our ever-popular Sundaes range even more inclusive for our non-dairy fans,” says Howell. “We’re also excited to introduce Spectacu-love. We know our fans love cookies nestled into their tub of Ben & Jerry’s as Cookie Dough continues to be our number one best seller, driving sales for grocery and convenience. Therefore, we wanted to bring our fans even more cookie-filled options. Spectacu-love will join our core collection of cookie-filled flavors. If you ask us, there’s s’more to love in 2024!”
Spectacu-love is a “decadent” addition to its core collection. Inspired by market insight that demonstrates a popular consumer trend of speculoos cookie, the fully loaded tub is jam packed with chunks of crunchy, golden speculoos cookies, nestled into sweet cream ice cream with swirls of complimentary smooth caramelized cookies.
The tub is loaded full of chunks of crunchy, golden speculoos cookies, nestled into sweet cream ice cream with swirls of complimentary smooth caramelised cookies, harnessing the popularity of the speculoos cookie. According to recent CMI research, when faced with a choice between flavours, sweet cream continues to prevail with shoppers in terms of appeal, and 84 per cent of Ben & Jerry’s fans regard the new flavour as new and different.
Most (70 per cent) of consumers are more likely to visit the high street after online retailers introduce return fees, shows a recent survey, indicating a shift in consumer buying habits.
According to the findings from consumer insights platform Vypr, 70 per cent of shoppers say they are now more likely to visit bricks and mortar stores rather than shop online due to the added costs of returning unwanted items.
The research highlights a growing dissatisfaction with the rise of online return fees, with 47 per cent of consumers stating they would avoid purchasing from retailers that charge for returns as they don’t believe their products are unique enough. A further 27 per cent said they would stop shopping with such retailers as a matter of principle.
While online shopping continues to be a dominant force, the research signals potential cracks in its convenience. Brands like Boohoo and ASOS, which have recently introduced return charges, may be particularly vulnerable as shoppers lack strong brand loyalty.
27 per cent of consumers said they think these retailers offer similar products to their competitors, making it easier to shop around for better deals. 53 per cent of those surveyed will be buying less from ASOS after the charges were introduced and 51 per cent shop less with Boohoo.
The growing frustration with online shopping is further exacerbated by issues with sizing and quality. According to Vypr’s survey, the most common reasons consumers return online purchases are due to items being smaller than expected (26 per cent), lower quality than anticipated (17 per cent), and larger-than-expected sizing (14 per cent).
Ben Davies, founder of Vypr, commented, “The rise in return charges reflects a broader shift in consumer sentiment. As confidence in online sizing and quality inconsistencies drops, many shoppers are reconsidering where they spend their money. One in 10 consumers say they typically order multiple sizes of the same item, knowing they’ll return some.
"Retailers must do more to improve size guides and product descriptions to help shoppers make better-informed decisions from the outset.
"As online shopping becomes more expensive and less distinct, it’s possible we could be witnessing a return to high street shopping — not only as a more reliable option but also as a more sustainable one, given the reduced packaging waste compared to online purchases.”
The research also reveals growing support for independent retailers, with 60 per cent of consumers now preferring to shop with smaller, independent brands over larger, fast-fashion retailers. Additionally, 64 per cent of respondents reported receiving better customer service from independents, compared to the experience with major online retailers.
World foods leader Surya Foods said it has acquired a major stake in leading health snack brand Karma Bites, as part of a series of moves to up its presence in the snacking arena.
Karma Bites produces a range of naturally flavoured, popped lotus seeds, a popular snack with a rich history in Chinese and Ayurvedic medicine - recognised as among the most nutrient dense seeds on the planet.
They have the moreish crunchiness of popcorn, and are packed full of protein and nutrients. The clean label range comes in five sweet and savoury flavours including: Himalayan pink salt, Peri-Peri, Wasabi, Caramel and Coconut & Vanilla. The range is also vegan, gluten free, non-GMO and free of refined sugars.
“My Grandma introduced me to the magic of popped lotus seeds. They have been a staple in my family for three generations, so I have experienced the benefits of these miracle seeds first-hand,” Karma Bites founder Ashwin Ahuja said.
“When I launched Karma Bites I was so excited to share them with the world and spread goodness! Working alongside Surya Foods, my aspiration is to take Karma Bites on the next big step of its journey - to scale up production, distribution, enter multiple markets and expand the range.”
“The superfood credentials of lotus seeds has helped the product take off in health conscious markets across Australia and the US (Los Angeles). The UK market generally follows these trends and there is a definite shift here in people understanding how their food choices impact their health,” Ahuja added.
Surya Foods plans to expand the brand with a swathe of NPD, to up its presence in the healthy snacking arena, and use the contemporary design of the brand to gain greater access to mainstream markets.
Surya Foods achieved an impressive 30 per cent increase in revenue last year and now supplies almost half of the UK’s branded dry rice supply across its leading UK Top 10 rice brands; Laila, Salaam and Mai Thai.
The food giant has also announced significant expansion plans at its Harwich site which will bring 200 additional new jobs to the Essex area over the next three years. It is on course to open a brand new custom-built, 40 acre head office/distribution centre, with 250,000 sq ft of storage facilities in Essex by 2026.
In 2020, Surya Foods made its first move into the snacking category, pouring £2m into a state of the art snack factory at its Harwich site. The factory currently produces snacks for its market leading brands including Laila, Thai Dragon and Kingstons, as well as offering private label services across a broad range of products.
Harry Dulai, group chief executive officer of Surya Foods, said: “We are pleased to have acquired a major stake in Karma Bites, which is a stylish contemporary brand with lots of mainstream potential. It aligns well with our plans to grow our snacking portfolio with several new launches in 2025. We continue to invest in the Harwich site to support our expansion plans and are committed to creating ‘better for you’ snacks, that have an improved nutritional profile.”
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Paški Sir PDO (Pag cheese), a sheep milk cheese from the Croatian island of Pag
The EU will remain a key resource for the UK food and beverage industry despite the challenges imposed by Brexit, according to new insights from UK industry supply chain professionals.
A survey carried out on behalf of the European Commission, which interviewed wholesalers, importers, producers and HORECA (Hotel, Restaurant and Catering) professionals across seven different food and beverage sectors, revealed that the majority will continue to import from the EU over the next 12 months.
Respondents from the wine and dairy/cheese sectors are 100 per cent committed to sourcing additional SKUs from the EU over the coming year, the data revealed. Whilst beer and spirits (80%), charcuterie and meat (80%) and bakery (70%) also showed a clear commitment to the EU.
In contrast, it is the confectionery and fruit & vegetable sectors which expressed the highest level of uncertainty or non-commitment. Both sectors only showed a 30 per cent commitment to sourcing additional SKUs from the EU in 2025, according to the data.
UK industry respondents cited quality (95%), pricing (81%), authenticity (78%) and sustainability (77%) as the most important factors that they consider when adding new SKUs to their product ranges. In parallel, authenticity and tradition were voted the most popular characteristics of EU food & beverage products (79% and 70%, respectively), whilst diversity (64%), good taste (62%), safety (59%), and high quality (54%) also ranked highly by those who were questioned.
When it comes to the wider merits of EU food and drink, more than two-thirds of respondents (66%) agreed that the EU’s Protected Designation of Origin (PDO), Protected Geographical Indication (PGI) and Organic labels are either ‘very important’ or ‘somewhat important’ when sourcing ingredients. Overall recognition of the three labels amongst the UK industry is high – around two-thirds know what they are and what they mean. The European Organic Products label is the most widely recognised (93%), while the PGI label is the least recognised of the labels, however recognition is still high (78%).
The research was conducted in April 2024 against the backdrop of the UK government’s Border Trading Operating Model, which set out a new approach to security controls with the aim of maintaining border security while minimising trade burdens.
“These insights demonstrate that despite the challenges and complexities of new cross-border trade agreements, the EU remains a valued partner and important resource for the UK’s food and drink industry and is likely to remain that way”, says Andrew Crumpton, founder of AMC Consulting and advisor to the ‘More Than Only Food & Drink’ campaign.
Veryan Bliss, managing director of Food Intelligence and fresh produce advisor to the EU’s ‘More Than Only Food & Drink’ campaign supports this view.
“It is clear that the relationship between the UK and EU is incredibly important. In 2023 the UK was the number one destination for EU agri-food, accounting for 22 per cent of exports and with a value of €51.3 billion,” Bliss said.
“The geographical diversity of the EU ensures a steady supply of seasonal produce and often complements the UK’s own growing patterns. When certain crops are out of season in the UK, EU producers support the offer, ensuring that UK retailers can offer a consistent, high-quality selection to consumers throughout the year.
“However responses from fruit and vegetable industry professionals highlight the impact of controls for fresh produce, which have been complex and changeable.”
“But with an easement on fresh produce checks now in place until July 2025 and confirmation that several fruit and vegetable products, which were previously deemed medium risk have now been changed to ‘low risk’, there is an increased potential for UK importers to benefit from the quality of organically and sustainably grown produce from the EU.”
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Vuse celebrates its position as the first global carbon neutral vape brand with a carbon neutral summer voyage down the Thames in 2021
British American Tobacco (BAT) has reported significant progress in its New Categories segment—comprising vapour, heated products, and modern oral—with strong growth in revenue and profitability during the second half of 2024.
In a trading update on Wednesday, the company said it is on track to deliver its 2024 financial year guidance, with the second-half performance acceleration driven by the phasing of New Categories innovation, the benefits of investment in US commercial actions and the unwind of wholesaler inventory movements.
BAT said its flagship vapour brand, Vuse, maintained its position as the global value share leader, achieving a 40.3 per cent share in key markets. Despite challenges posed by illicit single-use vapour products, particularly in the US and Canada, BAT said its investment in innovation and regulatory advocacy has positioned it well for future gains.
“Our Quality Growth imperative is delivering higher returns on more targeted investments across all three New Categories, and that prioritisation and focus is already transforming our business in Europe,” Tadeu Marroco, chief executive, said.
“We are making further progress increasing profitability across New Categories, and I am particularly pleased with the improvements in Heated Products and Modern Oral.”
BAT reinforced its leadership in the US, where Vuse captured 50.7 per cent value share in tracked channels, benefiting from stronger enforcement against illicit products in states like Louisiana. Globally, Vuse’s share remained stable, reflecting its strong brand equity.
Velo, BAT’s modern oral brand, demonstrated robust growth with its volume share in top markets rising to 28.2 per cent. Enhanced portfolio offerings, including new flavours and nicotine levels under Velo Plus, bolstered its momentum in the US and Europe.
Innovations such as glo Hyper Pro have shown promising results in improving BAT’s share in the heated tobacco market, particularly in Japan and Italy.
The company expects low-single figure organic constant currency revenue growth and low-single figure organic adjusted profit from operations growth in 2024. Marroco highlighted the company’s strategic pivot toward becoming a predominantly smokeless business by 2035, reiterating a commitment to sustainable value creation.
“Building on the strong foundations we have established, I am confident that we will deliver an improved underlying performance as we move from investment to deployment in 2025,” he said.
“We will continue to reward shareholders through strong cash returns, including our progressive dividend and sustainable share buy-back, and we remain committed to returning to our mid-term guidance of 3-5 per cent revenue and mid-single digit adjusted profit from operations growth on an organic constant currency basis by 2026.”
A 5p reduction in business rate multiplier will save convenience stores thousands of pounds per year which will help retailers invest in their businesses, ACS Government Relations Director Edward Woodall has said while giving evidence to a Committee of MPs in parliament today (11).
The Non-Domestic Rating (Multipliers and Private Schools) Bill intends to introduce higher business rates multipliers for the largest business properties (those over £500,000 in rateable value) and lower multipliers for retail and hospitality businesses. Following the Budget, the business rates discount for retail and hospitality businesses is reducing from 75 per cent to 40 per cent in April.
One of the considerations of the Bill is the level at which the new retail and hospitality multiplier could be set at. The small business multiplier is currently set at 49.9p, while the standard non-domestic rating multiplier is set is 54.6p.
During the evidence session, Woodall told the Bill Committee that to make a tangible difference to local shops and other businesses, the new multiplier should be set up to 20p lower than it is currently which would result in savings of thousands of pounds a year for essential retailers that could be put to use effectively.
ACS Government Relations Director Edward Woodall said, “The vast majority of convenience stores would benefit from the new retail and hospitality multiplier. For a retailer that sits just outside the threshold of small business rate relief at £15-16k rateable value, a 5p reduction in the multiplier would save them around £1,000 per year while a 20p reduction would save over £3,000 a year.
"This is a significant sum to help retailers invest in their business, either defensively on crime prevention and detection, or positively in their community.
"There are however thousands of stores that are dealing with increased costs in other areas of their business, particularly on employment, so for those businesses it is likely that the money saved on rates will go straight into keeping that store trading.”
ACS wrote to the Chancellor in advance of the evidence session outlining the costs that retailers are facing as a result of the measures outlined in the Budget. Overall, the convenience sector is looking at an increase in operating costs of around £666m, primarily in additional business rates, National Insurance contributions and National Living Wage increases.
During the evidence session, Woodall also highlighted the importance of discretionary rate relief for rural businesses, particularly those that are operating as the last local shop in that village or rural area.
Woodall said, “Reliefs for businesses that are trading in rural areas with communities that rely solely on them are extremely important, but it is challenging for the Bill to be able to address this effectively as there are often more differences within a region than there are between regions.
"We believe that the most effective relief for these businesses is distributed by local authorities, but we know that their budgets are extremely stretched, so it’s important that the Government looks at putting additional resources and trust in local authorities to deliver discretionary reliefs that support the last shop trading in rural areas.”