CHICAGO – Preparing for changes to the USDA Food and Nutrition Service’s (FNS) Supplemental Nutrition Assistance Program (SNAP) program will be the focus of Tuesday’s education session “What Do the New SNAP Retailer Eligibility Rules Mean for Retailers and Their Suppliers?”

The changes involve revising minimum stocking requirements for food retail stores that are eligible to redeem SNAP benefits. According to the FNS, many stores already stock a sufficient quantity and variety of foods to meet the eligibility criteria in the final rule. However, certain stores, including convenience stores, may need to make changes to their stock in order to remain eligible. Anna Ready, NACS director of Government Relations, and Eva Rigamonti, an associate with Steptoe & Johnson LLP in Washington, D.C., will lead the session, which summarized what retailers must stock to participate in SNAP. They also will discuss how supplier relationships impact compliance under the new rules and how the sales of hot food could render a store ineligible to participate in the program.

“C-store retailers who participate in SNAP play a critical role in providing access to food to those who need it most, especially in rural or densely urban areas where there is not a larger grocery store in close proximity or where the other food retailers are not open for extended hours,” Ready said. “Participation in SNAP is yet another way for a c-store to have a relationship with the community in which it operates and ensure it can serve all different types of consumers.”

Stock modifications
SNAP offers nutrition assistance to millions of eligible, low-income individuals and families. The 2014 Farm bill increased the “depth of stock” requirements for SNAP retailers. Depth of stock refers to the number and variety of items that retailers must have on hand in order to participate in the program. Changes increase the amount to seven varieties of food in the four staple food categories. That’s up from previous rules of three varieties of food in each category. The four staple food categories are (1) meat, poultry or fish, (2) bread or cereals, (3) vegetables or fruits and (4) dairy.

There must be at least one perishable food item in three of the categories. C-stores are challenged by the new regulations because of supply and delivery constraints, storage space and general store size, Ready said. Furthermore, FNS’ definition of “variety” is complicated, causing some ambiguity in what counts as a variety. For example, retailers can only count one item per species. If you stock both sliced ham and bacon, only one counts as a variety of pork.

“On average, convenience stores get food deliveries one to two times a week, which can make stocking certain foods, particularly perishable foods, difficult,” Ready said. “Also, the average convenience store is approximately 2,800 square feet, almost 16 times smaller than the average supermarket. This means that convenience stores have limited space in which to display and store products, particularly perishable products that must be refrigerated or frozen.”

In May, however, U.S. Congress realized the complexity of the definition “variety” and passed new language in the 2017 Omnibus bill. This bill delays the regulations from going into effect until FNS makes its definition of “variety” more workable for small format retailers like c-stores.

Supplier Assistance
In an effort to help c-store retailers hit the ground running when the new regulations kick in, Ready and Rigamonti say they plan to discuss the role of suppliers. “Suppliers will need to understand the rules in order to help retailers understand which products are eligible and ineligible. More importantly, suppliers may wish to rethink the ingredient percentages or makeup of certain products in order to ensure that retailers can stock specific items in certain categories,” Ready said.

For example, a hummus and pretzel pack will not meet SNAP stocking requirements if pretzels are the main ingredient. If, on the other hand, the main ingredient is listed as hummus, it could count towards the vegetable category.

Retailers are not required to participate in SNAP. However, the benefit of participation is the satisfaction in knowing you are serving a portion of your community that may not otherwise be able to afford to shop in your store. Retailers must meet the depth of stock requirements and ensure that no more than 50% of their total gross sales come from “hot foods” in order to participate as a SNAP retailer. Hot foods are defined as “cooked or heated on site by the retailer before or after purchase.”

Attend “What Do the New SNAP Retailer Eligibility Rules Mean for Retailers and Their Suppliers?” tomorrow at 2:30 pm the NACS Show.