Wednesday, July 23, 2008

Plastic or Plastic: Single-Use Plastic Carrier Bag Bans in California Cities Threatening Tesco Fresh & Easy's Free 'Plastic Bag-Only' Policy

Ironically, on July 1, the day before Tesco opened its 62nd Fresh & Easy Neighborhood Market grocery store in the Southern California city of Manhattan Beach, the Manhattan Beach City Council unanimously voted to ban the use of single-use plastic grocery bags in the city's grocery stores, pharmacies and other retail stores.

Why the irony? Because unlike pretty much all food and grocery retailers in California and throughout the U.S., Tesco's Fresh & Easy grocery stores offer shoppers free single-use plastic carrier bags only rather than the paper (grocery sacks) or plastic carrier bag option. Fresh & Easy stores do sell what they call "bags for life," which are synthetic, plastic-like clear reusable grocery bags for 20-cents each, along with canvas grocery carrier bags for a higher price, like most grocery stores in the U.S. are now doing.

Under the Manhattan Beach plastic grocery bag ban legislation which passed on July 1, grocery stores, food vendors, pharmacies and city facilities have six months to phase out the use of single-use plastic carrier bags in their stores in the city.; all other retail establishments have a year to do the same.

Manhattan Beach is the fourth California city to completely ban the use of the thin plastic grocery bags in grocery stores and pharmacies.

San Francisco, the first city in the state to do so, adopted a plastic carrier bag ban in June, 2007 for all grocery and drug stores in the city that have $2 million or more in annual sales. single-use paper bags are allowed under the San Francisco law, as they are under the just-passed Manhattan Beach single-use plastic carrier bag ban legislation.

The city of Oakland passed a plastic bag ban law similar to San Francisco's last year. However, a plastic bag industry trade group filed a lawsuit against the city of Oakland and its law. The lawsuit included an injunction which prevented Oakland from enacting the plastic bag ban until the lawsuit was settled.

Earlier this year, a court ruled the Oakland law invalid. Therefore, grocery and drug stores in the Bay Area city are still allowed to use the single-use plastic carrier bags in stores. The Oakland City Council is reworking the language of the plastic bag ban legislation but hasn't said if or when it will propose and vote on a new bill to ban the bags.

As part of its plan to enter the Northern California market with its small-format Fresh & Easy grocery stores, beginning either at the end of this year or in early 2009, Tesco plans to thus far open two Fresh & Easy grocery markets in San Francisco, and one in Oakland.

The grocery retailer thus far plans to open 21 Fresh & Easy stores in the San Francisco Bay Area. Tesco has confirmed 18 of those stores and Fresh & Easy Buzz has identified another three--two in the city of Vallejo and one in Pacifica--in our recent reporting.

Los Angeles City Council passes plastic bag ban yesterday

Yesterday, the Los Angeles City Council passed legislation banning the use of single-use plastic carrier bags in grocery and other retail stores in the city by 2010--but only if the California State Assembly fails to pass pending legislation that would would impose a 25-cent per plastic carrier bag fee on shoppers who request the bags in a California supermarket. [You can read about that pending legislation in an April 28 piece we wrote here.]

The Los Angeles plastic bag ban was proposed by Councilman Ed Reyes, who called plastic bags "the graffiti of the L.A. River," (his way of describing plastic bag litter) which passes through his district.

The new law was actually set to be enacted in 2012 rather than 2010. However, two members of the Los Angeles city council, Janice Hahn and Richard Alarcon, convinced their fellow council members to vote for the earlier deadline of 2010.

The Los Angeles plastic bag ban law is designed to encourage California legislators to vote for the proposed Assembly bill putting a 25-cent per-bag levy on all single-use plastic bags requested by consumers in the state's supermarkets. The consumers would pay the 25-cent per-bag fee at the point-of-sale.

Councilman Alarcon said at last night's meeting the Los Angeles city council would eventually pass a law regulating plastic bags. But for now, the council's vote is designed to persuade state lawmakers to impose a fee on the bags

"If they (state of California) don't do [a fee], then we do a ban," said Alarcon, who represents the northeast San Fernando Valley. "So yes, at some point there would be an ordinance."

The city of Los Angeles estimates that Los Angeles consumers use 2.3 billion plastic bags each year. According to the state of California, only about 5% of plastic bags are recycled statewide.

Plastic bags banned in Mailbu in May; more cities to come

The upscale coastal Southern California city of Malibu, which is known for being the home to numerous Hollywood celebrities, passed a law in May banning single-use plastic carrier bags in retail stores in the city.

The law applies to all retailers, including grocery stores, restaurants, pharmacies and city facilities. These Malibu retailers have about six months to comply with the plastic bag ban law, or face a fine of up to $1,000. Smaller vendors will have up to a year, as is the case with the Manhattan Beach law. Those larger stores, including the supermarkets, have only until about the end of the when the law goes into affect to phase out the use of the plastic carrier bags.

Malibu, an affluent city of about 25,000, currently has only four supermarkets, but numerous other retail stores.

Plastics industry groups also are threatening to file a lawsuit against the Malibu bag ban law.

Numerous other California cities are currently proposing news laws that would either ban single-use plastic carrier bags completely or levy a per-bag consumer fee on the bags at the retail point-of-sale.

Some of these California cities include: Encinitas in San Diego County, where the city council is currently debating single-use plastic bag ban legislation; Santa Monica (Southern California), which proposed a single-use plastic bag-ban ordinance in February of this year; Berkeley and Emeryville in the San Francisco Bay Area; Davis in the Sacramento region; Willits (and Mendocino County) in Northern California. About 30 California cities are currently considering either plastic bag bans or per-bag fee laws at present.

The San Francisco Bay Area city of Palo Alto, home to Stanford University, passed a law earlier this year that places a per-bag fee on each single-use plastic carrier bag requested by shoppers in the city's supermarkets and pharmacies. Numerous other cities are discussing per-bag fee laws like Palo Alto's rather than outright plastic bag bans in California.

The Manhattan Beach single-use plastic carrier bag ban was voted on at the Tuesday, July 1 city council meeting by the majority of the city's leaders. The council sited as its primary motivation for enacting the new law the negative effects of littered plastic carrier bags on the city's land and shoreline.

"Our children are watching and they want to know what we're going to do as caretakers of our environment," Councilman Mitch Ward said. "The city of Manhattan Beach has to do all that it can in its power to keep plastic out of the ocean."

Like they did in Oakland, a plastics industry trade group plans to file a lawsuit against the Manhattan Beach single-use plastic carrier bag law. In fact, a representative of one such industry trade organization said as much at the July 1 city council meeting.

Stephen Joseph, an attorney representing a group of plastic retailers and manufacturers who believe a ban would threaten their businesses, said he would file suit against Manhattan Beach in the next month or so.

Members of the Manhattan Beach City Council say they aren't afraid of such a lawsuit, claiming they believe their legislation will hold up in court.

"I know we will prevail when we do get sued - thank you very much," Councilman Jim Aldinger said, in response to the threat of a lawsuit by the plastic industry.

The Manhattan Beach City Council says the new law isn't about favoring paper grocery sacks, which actually require more energy inputs per-bag to produce than plastic grocery bags but also are recycled at much higher rates, over single-use plastic carrier bags. Rather, the city says it plans an extensive educational campaign designed to encourage residents to use reusable shopping bags at all stores in the city.

"The ordinance is not about transitioning from plastic to paper," Councilwoman Portia Cohen said. "It's about transitioning from paper or plastic to reusable bags."

The citywide goal is to get Manhattan Beach residents to use reusable shopping bags at city stores, the city council said in unison at the recent meeting where they voted in the new law.

Tesco's Fresh & Easy will have to change plastic-only bag policy

Tesco only offers free, single-use plastic carrier bags (no paper) at its 63 small-format, combination basic grocery and fresh foods stores in Southern California, Nevada and Arizona.

Part of the reason for the retailer doing this, despite the fact every competitor in the three states offers paper or plastic, is because Fresh & Easy stores offer only self-service (clerks will assist shoppers if they ask) checkout in its stores. The checkout stands, which are specifically designed for self-service checkout, aren't designed with holders for various sizes of paper grocery sacks like convention full-service checkout counters are. Therefore, this was a key driving force behind Tesco's decision not to offer paper grocery sacks as an option in its Fresh & Easy grocery stores, sources close to Tesco have told Fresh & Easy Buzz.

Tesco could if it wanted however figure out a way to modify the checkout stands to say hold two or three sizes of paper grocery sacks, although of course that would require an investment in retrofitting the checkout counters, along with the added cost to the grocery chain of providing the free paper bag option to customers, as all of its food retailing competitors already do.

In fact, Trader Joe's has the opposite policy of Fresh & Easy. At Trader Joe's grocery stores, unless a customer specifically asks for a single-use plastic grocery sack, the store clerk at the checkout counter bags the shopper's purchases in a paper grocery bag, or in the customer's reusable shopping bag(s) if they have them. Fresh & Easy also encourages the use of reusable grocery bags. However, since the grocer doesn't offer the paper bag alternative, single-use plastic carrier bags are the default bag at all Fresh & Easy grocery stores.

In April, Whole Foods Market, Inc. took the Trader Joe's paper grocery sack as the default bag policy even further, when it stopped offering single-use plastic carrier bags in all of its U.S, Canadian and United Kingdom natural foods supermarkets in April of this year. The only free carrier bag at Whole Foods' stores today is a paper grocery sack, which is made from post-consumer recycled paper and is 100% recyclable.

Whole Foods stores sell and encourage shoppers to use reusable shopping bags in its stores, offering a per-bag rebate of 15-cents for each reusable bag they bring with them that is used to pack their grocery purchases at the point-of sale, as do many other California food retailers.

In six months, Tesco's Fresh & Easy will no longer be able to offer the single-use plastic grocery bags in its Manhattan Beach store, which on July 2 had the biggest customer turnout of any of the retailer's previous grand openings.

Therefore, Fresh & Easy will have to decide if it wants to join its competitors in offering the paper bag option in at least the Manhattan Beach store, and perhaps in some of its other grocery stores. Doing so seems like something the food retailer will have to do, since very few shoppers bring reusable shopping bags with them to the grocery store despite aggressive efforts by retailers and state and city governments to encourage them to do so.

We doubt Fresh & Easy Neighborhood Market's offering to shoppers will be: 'You can either bring your own bag, buy one of our "bags for life" or canvas shopping bags while in the store, or if not carry your grocery purchases out to your car in your hands.

Rather, we suspect, at least for now at the Manhattan Beach Fresh & Easy store, Tesco will join the majority of food retailers and offer the paper grocery sack option--which in six months won't even be an "option" in Manhattan Beach. Instead it will be the only type of free grocery bag stores in the city can offer shoppers.

Of course, Tesco could offer 100% biodegradable plastic grocery bags at the Manhattan Beach store. However, such bags are yet to be widely available at a reasonable cost to grocers, which is why they are used so infrequently.

Tesco will also have to make a similar decision when it opens its two San Francisco stores next year. Since the city bans grocery stores doing over $2 million a year from offering single-use plastic bags (if the Fresh & Easy stores don't do over $2 million a year they are in trouble), the retailer will either have to offer paper grocery sacks in those stores or force shoppers to either bring their own bags or buy one of the two versions of Fresh & Easy's reusable bags in-store. The bring or buy option is very unlikely, not to mention a sure way to drive away customers if it is enacted.

Additionally, since Tesco has Fresh & Easy stores in Los Angeles, it will have to make the same decision for those stores it has to make in Manhattan Beach and San Francisco---and soon all over California since many other cities will be passing similar plastic bag ban laws--if a ban eventually goes into law in the City of Angles

Plastic bags only: a PR disaster waiting to happen for Tesco's Fresh & Easy

Meanwhile, we're surprised Tesco's "green" or environmental retailing credibility isn't being challenged by environmental groups over the fact the grocery chain doesn't offer the paper bag option.

In the past, U.S. supermarket chains like Safeway Stores, Inc. at one time considered offering only plastic grocery bags in its stores, and smaller chains even tried it for a time in the 1980's when the single-use plastic carrier bag started to become all the rage in American supermarkets.

However, environmental groups and often cities spoke out strongly against such plans, threatening to launch public relations and grass roots campaigns against food retailers who enacted such a policy.

All of the retailers backed off, and those few who tried plastic-only went back to paper or plastic. Saving a few pennies per-paper bag, which is tempting in the penny-tight food retailing business, by offering plastic only wasn't worth it to these retailers when weighed against the substantial loss of business that could occur as the result of a negative PR campaign by environmental groups.

And, this was in the 1980's and early 1990's, when compared to today the anti single-use grocery bag issue and movement was barely in its infancy. Today, the issue is arguably the chief environmental retailing issue, especially among cities, environmental groups, numerous consumers, and thus the food and grocery retailing industry in the U.S.

There's also the simple non-environmental issue which was true then and still is today: many consumers like paper grocery sacks and hate plastic. Not offering them the option is one way of discouraging potential new and repeat customers. Consumers like choice at the grocery store; that's why essentially every food retailer of note in the U.S. offers the paper or plastic--except Tesco's Fresh & Easy Neighborhood Market. Doing so seems illogical and counterproductive for the grocery chain.

If ever there is a policy waiting for a negative campaign to be launched against a grocery retailer, its the policy of offering only single-use plastic bags in stores like Tesco's Fresh & Easy Neighborhood Market is currently doing. This is despite the fact Fresh & Easy offers the inexpensive "bags for life," which it even says it will replace for shoppers for life, along with reusable canvas shopping bags.

The groups and government bodies opposing single-use plastic bag use by grocery and other retailers have made it clear in the laws passed in the case of cities, and in the case of the environmental groups by there positions, that offering free paper grocery sacks is the preferred policy rather than offering plastic bags only, or for that matter even paper or plastic.

In the case of the environmental groups, which are primarily behind most of the single-use plastic carrier bag legislation, this fact is evidenced by their unanimous support of Whole Foods decision that last April on Earth Day the natural foods grocer would eliminate plastic carrier bags in its stores completely. Much of the reams of positive publicity Whole Foods received for the policy change came from various and numerous environmental organizations.

In our analysis, Tesco's Fresh & Easy is just one environmental group away from having a campaign launched against it over its policy of offering only single-use plastic carrier bags in its stores.

We suggest this is the case not as an opinion as to whether or not the retailer should offer both plastic and paper--although in the spirit of full disclosure we believe it should--but rather based on an analysis of the issue, an understanding of the food and grocery retailing market in the U.S. today, conversations with many who agree with our analysis, and the simple fact that Tesco is the only grocery retailer of note in California, Nevada and Arizona that isn't currently offering the paper or plastic carrier bag option to consumers in its stores.


Click here to read a selection of past reports and stories on the single-use plastic carrier bag issue published in Fresh & Easy Buzz.

1 comment:

Anonymous said...

Paper bags cost more to produce, not to mention the trees cut down to produce them. They also weigh far more than Plastic, & take up more space on the delivery trucks, costing far more to transport.

Also particularly with Neibourhood markets, People are more likely to walk home that drive. Plastic is more suited for that task. bags for life are more suited than either option.