NACS, the National Grocers Association and FMI – The Food Industry Association, released the “SNAP Restrictions Impact Analysis” that estimates the significant costs food retailers will face under proposed restrictions to the Supplemental Nutrition Assistance Program (SNAP).
 
The Impact Analysis reveals that the total up-front cost from SNAP restrictions is projected to be:

• $1 billion for convenience stores;
• $305.1 million for supermarkets;
• $11.8 million for small-format stores; and
• $215.5 million for supercenters.

 
The total cost across all channels is expected to be more than $1.6 billion, an amount equal to 1.9% of 2024 net income for all food retailers.
 
In addition to the up-front costs, ongoing annual costs of maintaining compliance are estimated at $378.6 million for convenience stores, $281.4 million for supermarkets, $18.0 million for small-format grocery stores and $81.1 million for supercenters, totaling nearly $759.1 million per year.
 
In a joint statement, the three associations noted, “Food retailers and convenience stores are committed to supporting efforts to improve the nation’s health, but the proposed restrictions represent significant new costs and operational challenges. Without clear guidance and adequate time, these well-intended changes will create unexpected difficulties of both retailers and the customers they serve.”
 
Margaret Mannion, director of government relations at NACS, added, “These new restrictions are unprecedented. Without clear rules and the time to implement them, they will impose significant costs on all American consumers, not just SNAP participants.”
 
According to the Impact Analysis, key cost drivers include technology updates, software and point-of-sale system upgrades, as well as the labor required to comply with new stocking, replenishment and labeling requirements. The report emphasizes that the effects are especially severe for smaller stores, which will be required to undertake time-consuming tasks to comply with state-level rules for item qualification.
 
Given the scale and complexity of these changes, SNAP retailers are calling on the United States Department of Agriculture (USDA) and states to:

• Extend the timeline for implementing SNAP restrictions to allow retailers, especially independent and small retailers, to take adequate time to adapt systems and processes.
• Provide clear and actionable definitions of restricted foods to ensure that all retailers can comply with new regulations and waivers without ambiguity.

The full report is available online here.