BABY

Major supermarket becomes second retailer to cut baby formula prices to help struggling parents

Last modified on Monday 15 January 2024

Baby formula / mum feeds baby from a bottle

Two major supermarkets are passing the savings on to their customers – from tomorrow

Asda has become the second supermarket to cut the price of baby formula, after Iceland last week said it would be cutting the cost of Aptamil.

it comes after manufacturer Danone, which makes Aptamil and Cow & Gate products, said it recognised 'the challenges faced by parents due to inflation' and agreed to a 7% price cut to retailers.

Both Iceland and Asda will pass these savings on to parents, and Asda also said it will let customers pay for baby formula using their rewards scheme vouchers for the first time.

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It's expected more supermarkets will follow suit.

'A vital necessity in the weekly shop'

Asda said it would cut the price of six Aptamil lines 'the majority by an average of 7%.'

Five Aptamil core products will drop from either £14.50 or £14 to £13.50, while Aptamil Advanced 1 First Formula Baby Milk Powder from Birth will fall from £19 to £18.

Asda’s chief commercial officer, Kris Comerford, said: 'For many of Asda’s customers, and families nationwide, we understand that buying baby formula is a vital necessity in their weekly shop, which is why we’re taking swift action to pass on falling manufacturing costs to customers before any other retailer.

'At the same time, we’ve decided to remove exclusions on using Asda rewards vouchers to pay for baby formula as we want to do everything we can to help families manage their budget and keep their family fed.'

Price reduction

In a statement, Danone said: 'We recognise the challenges faced by parents due to inflation. During this difficult period, we have worked very hard to absorb the significant cost increases we have faced, make savings, and minimise any price increases.'

It comes as a recent investigation by the UK's competition watchdog, the Competition & Markets Authority (CMA), found that the company had raised the prices of its baby formula by 25% in two years.

The price of an 800g pack of Danone's Aptamil formula went up by 26% to around £14.50 between March 2021 and April 2023.

However, the company won't make the same cut on its liquid baby milks or any of its Cow & Gate products.

What does this mean for families?

Whether or not all retailers will pass on the savings to customers is not yet known. So far, however, budget supermarket Iceland has confirmed it will make cuts to its products in stores.

The supermarket said that the price drop would be passed onto customers, with three ranges of Aptamil formula being dropped in price.

These are:

  • Aptamil First Infant Milk
  • Aptamil Growing Up Milk
  • Aptamil Follow-on Milk

All three products will be reduced from £12 to £11.20 in Iceland stores from next week.

Richard Walker, executive chairman of Iceland Foods, said that it was important that prices were reduced, but that more support was still needed for families.

He added:

'While we support breastfeeding as the most beneficial way of feeding infants, the millions of families who rely on formula need more support for their choice or circumstances and simply reducing the price won’t solve the systemic issues we’ve drawn attention to.'

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Parents being 'exploited'

Last year, the CMA said it had seen the price of baby formula grow by 25% over a two-year period – putting pressure on low-income families struggling amid a Cost of Living crisis.

The competition watchdog said that around 75% of branded suppliers have been making more profit on individual products – pushing up the prices of everyday items.

At the time, Sarah Cardell, chief executive of the CMA, said: 'We're concerned that parents may not always have the right information to make informed choices and that suppliers may not have strong incentives to offer infant formula at competitive prices.'

And it's put a 'huge strain on household budgets', she added.

Strict rules

However, there are strict rules on how supermarkets and shops can sell baby products.

For example, no supermarket in the UK is allowed to promote or offer a discount on baby formula.

And, under EU law (which the UK retained from February 2020), retailers cannot offer any discount on new baby formula milk or offer coupons or points with loyalty schemes.

There have been calls for a change in the law so that stores CAN offer discounts on baby formula and so parents can use loyalty points, vouchers or food bank vouchers to pay for the baby item.

Campaigners have called out 'profiteering' in the baby formula market and the World Health Organisation (WHO) said that families are being 'exploited'.

Currently, only one supermarket – Aldi – offers an own-brand alternative to branded baby formulas.

The CMA added that new parents could make significant savings of up to £500 in the first year of a baby's life on formula milk products by shopping around and buying cheaper formula.

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