“Hand-Me-Down” Menu Regulations Just Don’t Fit Convenience Stores | Commentary

Posted August 5, 2014 at 11:55am

Anyone with older siblings or cousins remembers the joys of “hand-me-down” clothes. They were a common-sense approach for Mom, of course. But somehow those outfits never fit right, felt right, or looked right — they sagged here and bunched up there, and certainly weren’t your favorite color or style.

Why? Because they were really meant for someone else — and not for you.

“Hand-me-down” is pretty much the same approach being taken by the Food and Drug Administration with new restaurant menu labeling regulations required by the Affordable Care Act. The agency’s proposed rules are a reasonable, though hardly perfect, fit for the big chain restaurants. These restaurants offer simple, standardized menus at all locations, Congress’s intent was to make sure those menus provide clear, understandable nutrition information.

But the menu labeling regulations don’t make sense at all for convenience stores, grocery stores, delivery operations and other approaches to food service.

The FDA rules essentially define a “restaurant or similar retail food establishment” as any business that devotes more than half of its floor space to consumer food sales and also offers restaurant-type items. That makes a convenience store a “restaurant” even if 95 percent of its space is devoted to grocery items, and it sells only one or two prepared items at the counter. And the same rules apply to delivery-only operations — where consumers may never even walk in the door — as to full-service counterparts.

The simple fact is that these small businesses are different from the big, cookie-cutter fast-food chains — and from each other. Many of them are owned and operated by small businessmen and women who are covered under the rules because they happen to operate as a franchisee of a larger corporation. Others are covered because they’re parts of cooperatives for purchasing and marketing. But they are owned and operated independently and have wildly varying food offerings, modes of service and suppliers. These traits make it exceedingly difficult to comply with the FDA’s proposed rules.

Nevertheless, the “hand-me-down” regulations would require these local establishments to display the same kinds of menu boards disclosing calories as fast-food chains — even if they are delivery-focused and already put their calorie information online where customers order. Foods on display — like in most convenience stores — would have to be individually labeled on signs next to the food.

Hand-me-down clothes, though not optimal, are at least cheaper, prevent waste and provide those who wear them the benefit of being warmly (if not stylishly) dressed. But the “hand-me-down” FDA labeling regulations? Just the opposite.

The regulations are outrageously expensive for the small businesses that have to comply with them. In fact, the National Association of Convenience Stores estimates an average cost of approximately $20,000 per year, per store just to comply with the additional cost of compliance.

Yet it’s not just the cost: the Office of Management and Budget has found that FDA’s proposed rules would take more than 14 million hours to comply with: one of the largest burdens of any regulation issued the year they came out. All this time and expense for the mere handful of prepared food items many convenience stores offer.

If the rules would make sure consumers were better informed and eating healthier at least that would help. Unfortunately, they won’t.

FDA’s own Preliminary Regulatory Impact Analysis could not quantify any benefits to the menu labeling regulations. That’s because some 95 percent of food items sold in grocery and convenience stores already display nutrition information. So $1 billion in costs and 14 million hours of time to comply — with no showing of benefit. Somehow that doesn’t seem like what Congress had in mind.

The good news is that Congresswomen Cathy McMorris Rodgers, R-Wash., and Loretta Sanchez, D-Calif., have joined with more than 80 of their colleagues from both sides of the aisle to offer convenience stores, grocery stores and delivery operations a custom fit — with the Common Sense Nutrition Disclosure Act of 2013. The Senate is also considering companion legislation (SB 1756).

The bill is exactly what its name says: a common-sense approach that lets delivery establishments provide calorie counts with online orders, offer flexibility in labeling items that are variable or intended for multiple customers, allow for inadvertent product variations, and most importantly, limits the labeling rules to real restaurants.

The FDA got the size and style all wrong for thousands of small businesses when it tried to fit them with the same heavy-duty menu labeling regulations as big fast-food chains. When it comes to small businesses that just want to offer the convenience of a few prepared food items, let’s hope Congress discovers the common sense to design a solution that really fits.

Brad Call is the chairman of the National Association of Convenience Stores (NACS) and executive vice president of Maverick Inc.