Supermarkets are threatening to halt online deliveries of soft and alcoholic drinks, in what has been described as a “nuclear option” to block plans for the UK’s first deposit return scheme.
This week it emerged retailers have warned the Scottish government they are prepared to cease “some or all” online deliveries of drinks containers covered by the scheme unless it drops proposals making major companies responsible for online takeback.
Sources told The Grocer such a move would be “catastrophic” for the rollout of DRS and the intervention comes with Rishi Sunak this week facing renewed calls from retailers and suppliers to shelve the DRS rollout elsewhere across the UK.
This week, the Scottish government published proposed amendments to its DRS rollout, due to start from next April, which put a specific obligation on the largest retailers to shoulder the costs and logistics of online takeback. Ministers have previously said smaller retailers would be exempt from the scheme online.
Infrastructure
However, the Scottish Retail Consortium said because retailers were unable to use their own vehicles to collect containers due to food safety risks, the scheme would require them to build new infrastructure, purchase new vehicles, and reconfigure their online retail operations to deliver these obligations.
It said such a move would be “incredibly expensive, significantly increase carbon emissions through new journeys, and would require very significant time to develop and deliver”.
“As a result those retailers obliged under these rules are likely to explore whether it’s more cost effective to cease some or all of their online sales in Scotland as they will not be able to comply with these requirements,” said SRC deputy head Ewan MacDonald-Russell.
He added he feared ministers believed retailers were “bluffing”, but insisted the threat was serious.
“Scottish ministers seem prepared to risk ending online drink sales in Scotland with their unworkable, unsustainable, and undeliverable ultimatum in the amended deposit return scheme regulations.
“Grocery retailers have insisted for months on end they cannot deliver an online takeback solution in time for the new go-live date whilst explaining the only way this can be delivered is through a centralised model. Regrettably those valid concerns appear to have been ignored.
Serious decisions
“It is not economically, environmentally, or legally sustainable for retailers to collect empty drinks containers from customer’s homes using their own vehicles. Larger retailers will now need to take very serious decisions about whether it’s possible to continue selling drinks online in Scotland, after March next year.
“Ironically, these proposals will make life harder for vulnerable consumers who may now lose the opportunity to have drinks delivered directly to their home.”
A senior drinks industry source added: “It’s completely naïve of ministers to think that the industry will just step in and sort this out.
“As things stand the industry is going to need new lorries, or health and safety rules are going to be have to be ripped up. Realistically none of those are going to happen.”
Another source added: “Perhaps it is going to take the threat of such a nuclear option to get ministers across the UK to sit up and realise that they need to halt the plans for DRS and think again about the proposals and the timeframe.
“At this week’s summit there was widespread agreement across different sections of the industry that the government has to do something. Surely now is the time for them to announce a halt.”
No comments yet