Food Companies Need To Change Before Doomsday Package Labels Kill Them

Chile Black Stop Sign Food Package LabelsWikiMedia/Aeveraal

Like a volcano eruption in Asia that affects the weather in St. Louis, a phenomenon sweeping across Latin America has the potential to spur a chain reaction on other continents. With up to two-thirds of their populations overweight and/or obese, countries south of the U.S. border are forcing food companies to put health warnings on their package labeling. And while the U.S. market may not require similar labeling for now, food companies shouldn’t get comfortable. Smart ones should get ahead of the game and work in earnest to make their product portfolios far healthier.

A number of Latin American governments are adopting extreme labeling - draconian graphics once reserved for cigarettes, dry cleaner bags and rat poisoning - on snack foods, confections, packaged desserts, sweetened cereals and sugary beverages. Policymakers and public health activists worldwide are cheering these warnings, guaranteeing that they’ll spread beyond Latin America.

Chile has become the epicenter for this packaging revolution where shoppers see a proliferating number of labels with somber black stop signs warning of excessive sodium, sugar, saturated fat or calories. The unhealthiest of products can have all four stops signs. The movement started in 2016, where health officials estimate 67% of the adult population is overweight and/or obese and diabetes runs rampant. One of the warnings symbols’ biggest proponents, Chilean Senator Guido Girardi, has called food companies “21st century pedophiles.” Now Chile doesn’t allow lovable mascots on food packaging. It also prohibits sales of junk food and sweets in schools, and bans junk food advertising during prime TV hours. All this is in addition to an 18% sales tax imposed on soda in 2014.

Other countries across Latin America have adopted or are considering similar restrictions. In Peru and Uruguay, executive orders have cleared the way for the black stop signs. The Brazilian Health Regulatory Agency ANVISA is having informal discussions with many stakeholders about adopting a similar warning system, and Argentinian health officials are scrutinizing what their neighbor to the north is doing.

All are watching Mexico, which in 2013 imposed an aggressive soda tax that has reduced sales of sugary beverages and, according to proponents, will reduce diabetes cases by 134,000 by 2030.

New labels and aggressive taxes are already affecting global food companies, forcing many into expensive reformulations to avoid the dreaded black stop sign. For instance, Coca-Cola has removed 33,000 tons of sugar from its beverages sold in Chile and 95% of its portfolio consists of low- and no-calorie beverages. Companies are also redesigning packaging to eliminate the now-banned mascots: gone are Tony the Tiger, the Nesquik bunny and dancing M&Ms. While the jury is still out on how it has affected sales, nearly 40% of Chilean consumers say that the black octagons are influencing their purchasing decisions, and that the warnings are having an even bigger impact on their children - the consumers of the future.

This is a headache for big food and beverage companies, and it promises to get worse. Chile is already promoting the black stop signs as a solution that could work worldwide. Government officials there have amassed some powerful allies, including the Pan American Health Organization (PAHO), the Latin American branch of the World Health Organization, which this year unveiled a plan to urge governments worldwide to eliminate trans fats.

Bloomberg Philanthropies is studying the results of Chile’s new restrictions; its founder Michael Bloomberg introduced the first municipal ban on trans fats for restaurants in 2006 when he was mayor of New York City and has pushed to limit the cup size of sugary drinks. Influential food advocate Barry Popkin has studied the results of the Mexico tax and concluded that it’s working.

While it’s too early to tell whether Latin Americans are consuming fewer calories overall or if obesity rates there will decline, food and beverage companies should assume that taxes and doomsday labeling will spread to the U.S. and everywhere else. Indeed, just a few days ago Kellogg’s, perhaps foreseeing the inevitable, agreed to put “traffic light” labeling (red, amber, and green indications) for ingredients on cereal packages sold in the UK.

The time is now for food, beverage and restaurant companies to get ahead of the curve. The best way for them to do that is to make solid commitments to the public to reduce calories, sugar, salt and/or saturated fats in their foods.

This means spending less money on fighting change and more on embracing and getting ahead of it.  Unfortunately many food and beverage companies are still relying on the same playbook as big tobacco to fight change: strike alliances with friendly doctors; insist the real problem is people don’t exercise enough, and spend big on initiatives to defeat taxes. Here is what they should be doing instead:

Set a Big, Hairy, Audacious Goal (“BHAG,” as defined by James Collins and Jerry Porras in their 1994 classic book, Built to Last) to address obesity while giving individual companies flexibility to reconfigure their product portfolios. The food, beverage and restaurant industries must make a concentrated effort, across all sectors and on all continents, to cut the calories in what they sell. Widespread obesity is a global crisis. Despite pockets of profound malnutrition, humans today consume an average 582 more calories a day than they did in the mid-1960's. Companies can do their part by pledging a 10% reduction in the calories in their product portfolios. They can do this imperceptibly and gradually so that consumers don’t notice. However, they must set and make known ambitious goals and then let independent parties measure and report their progress on those targets.

Follow the leaders. The National Confectioners Association, the trade group for the candy industry, has already gotten leading member companies to commit to making more than half of their single-serve products 200 calories or less. The 16 food and beverage companies involved in the Healthy Weight Commitment Foundation sold 6.4 >trillion fewer calories in the United States in 2012 than they did in 2007.Other companies and other industries must follow suit.

Give Consumers What They Want. The public has wanted healthier foods and beverages for a long time, but it has taken most of the food industry longer to respond. Sweetened soda consumption in the U.S. is at its lowest levels since the 1970's, as more consumers shift to bottled water and other no- or low-calorie beverages. Consumer packaged goods companies are starting to realize that making better-for-you products helps them increase sales. Many companies are cautiously starting this transition but are not moving fast enough. With solid public commitments to reduce calories, they could make more dramatic progress.

What’s happening in Latin America can’t be ignored, especially when obesity continues to be a stubborn health crisis in industrialized countries everywhere. Whether it’s a black stop sign or a more benign traffic light, the warning symbols popping up in grocery store aisles are more than just a guideline for consumers. It’s the handwriting on the wall for big food and beverage companies that have been complacent for too long.

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Chile Black Stop Sign Food Package LabelsWikiMedia/Aeveraal

Like a volcano eruption in Asia that affects the weather in St. Louis, a phenomenon sweeping across Latin America has the potential to spur a chain reaction on other continents. With up to two-thirds of their populations overweight and/or obese, countries south of the U.S. border are forcing food companies to put health warnings on their package labeling. And while the U.S. market may not require similar labeling for now, food companies shouldn’t get comfortable. Smart ones should get ahead of the game and work in earnest to make their product portfolios far healthier.

A number of Latin American governments are adopting extreme labeling - draconian graphics once reserved for cigarettes, dry cleaner bags and rat poisoning - on snack foods, confections, packaged desserts, sweetened cereals and sugary beverages. Policymakers and public health activists worldwide are cheering these warnings, guaranteeing that they’ll spread beyond Latin America.

Chile has become the epicenter for this packaging revolution where shoppers see a proliferating number of labels with somber black stop signs warning of excessive sodium, sugar, saturated fat or calories. The unhealthiest of products can have all four stops signs. The movement started in 2016, where health officials estimate 67% of the adult population is overweight and/or obese and diabetes runs rampant. One of the warnings symbols’ biggest proponents, Chilean Senator Guido Girardi, has called food companies “21st century pedophiles.” Now Chile doesn’t allow lovable mascots on food packaging. It also prohibits sales of junk food and sweets in schools, and bans junk food advertising during prime TV hours. All this is in addition to an 18% sales tax imposed on soda in 2014.

Other countries across Latin America have adopted or are considering similar restrictions. In Peru and Uruguay, executive orders have cleared the way for the black stop signs. The Brazilian Health Regulatory Agency ANVISA is having informal discussions with many stakeholders about adopting a similar warning system, and Argentinian health officials are scrutinizing what their neighbor to the north is doing.

All are watching Mexico, which in 2013 imposed an aggressive soda tax that has reduced sales of sugary beverages and, according to proponents, will reduce diabetes cases by 134,000 by 2030.

New labels and aggressive taxes are already affecting global food companies, forcing many into expensive reformulations to avoid the dreaded black stop sign. For instance, Coca-Cola has removed 33,000 tons of sugar from its beverages sold in Chile and 95% of its portfolio consists of low- and no-calorie beverages. Companies are also redesigning packaging to eliminate the now-banned mascots: gone are Tony the Tiger, the Nesquik bunny and dancing M&Ms. While the jury is still out on how it has affected sales, nearly 40% of Chilean consumers say that the black octagons are influencing their purchasing decisions, and that the warnings are having an even bigger impact on their children - the consumers of the future.

This is a headache for big food and beverage companies, and it promises to get worse. Chile is already promoting the black stop signs as a solution that could work worldwide. Government officials there have amassed some powerful allies, including the Pan American Health Organization (PAHO), the Latin American branch of the World Health Organization, which this year unveiled a plan to urge governments worldwide to eliminate trans fats.

Bloomberg Philanthropies is studying the results of Chile’s new restrictions; its founder Michael Bloomberg introduced the first municipal ban on trans fats for restaurants in 2006 when he was mayor of New York City and has pushed to limit the cup size of sugary drinks. Influential food advocate Barry Popkin has studied the results of the Mexico tax and concluded that it’s working.

While it’s too early to tell whether Latin Americans are consuming fewer calories overall or if obesity rates there will decline, food and beverage companies should assume that taxes and doomsday labeling will spread to the U.S. and everywhere else. Indeed, just a few days ago Kellogg’s, perhaps foreseeing the inevitable, agreed to put “traffic light” labeling (red, amber, and green indications) for ingredients on cereal packages sold in the UK.

The time is now for food, beverage and restaurant companies to get ahead of the curve. The best way for them to do that is to make solid commitments to the public to reduce calories, sugar, salt and/or saturated fats in their foods.

This means spending less money on fighting change and more on embracing and getting ahead of it.  Unfortunately many food and beverage companies are still relying on the same playbook as big tobacco to fight change: strike alliances with friendly doctors; insist the real problem is people don’t exercise enough, and spend big on initiatives to defeat taxes. Here is what they should be doing instead:

Set a Big, Hairy, Audacious Goal (“BHAG,” as defined by James Collins and Jerry Porras in their 1994 classic book, Built to Last) to address obesity while giving individual companies flexibility to reconfigure their product portfolios. The food, beverage and restaurant industries must make a concentrated effort, across all sectors and on all continents, to cut the calories in what they sell. Widespread obesity is a global crisis. Despite pockets of profound malnutrition, humans today consume an average 582 more calories a day than they did in the mid-1960's. Companies can do their part by pledging a 10% reduction in the calories in their product portfolios. They can do this imperceptibly and gradually so that consumers don’t notice. However, they must set and make known ambitious goals and then let independent parties measure and report their progress on those targets.

Follow the leaders. The National Confectioners Association, the trade group for the candy industry, has already gotten leading member companies to commit to making more than half of their single-serve products 200 calories or less. The 16 food and beverage companies involved in the Healthy Weight Commitment Foundation sold 6.4 >trillion fewer calories in the United States in 2012 than they did in 2007.Other companies and other industries must follow suit.

Give Consumers What They Want. The public has wanted healthier foods and beverages for a long time, but it has taken most of the food industry longer to respond. Sweetened soda consumption in the U.S. is at its lowest levels since the 1970's, as more consumers shift to bottled water and other no- or low-calorie beverages. Consumer packaged goods companies are starting to realize that making better-for-you products helps them increase sales. Many companies are cautiously starting this transition but are not moving fast enough. With solid public commitments to reduce calories, they could make more dramatic progress.

What’s happening in Latin America can’t be ignored, especially when obesity continues to be a stubborn health crisis in industrialized countries everywhere. Whether it’s a black stop sign or a more benign traffic light, the warning symbols popping up in grocery store aisles are more than just a guideline for consumers. It’s the handwriting on the wall for big food and beverage companies that have been complacent for too long.

Source : https://www.forbes.com/sites/hankcardello/2018/11/30/food-companies-need-to-change-before-doomsday-package-labels-kill-them/

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