UK retailer Iceland Foods is cutting the price of Nestlé baby milk products amid the scrutiny on the cost of infant formula in the country.
From today (27 February), two products sold under Nestlé’s SMA brand – the Little Steps First Infant formula and the Follow-on Milk – will be sold for £7.95 ($10.08) in The Food Warehouse stores and online through Iceland’s website.
The retailer, which has called for an easing in the restrictions on how infant formula can be promoted in the UK, said the step will be “followed by a roll-out across Iceland stores”.
According to Iceland, the new price is “£1.80 less than any other supermarket and cheaper than German discounter Aldi’s own brand, Mamia”.
Richard Walker, executive chairman of Iceland Foods, said the company has a “moral obligation to take action”.
He added: “That is why we are heaping further pressure on the manufacturers, the regulators and the market as a whole to bring prices down, just like Iceland is doing.”
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By GlobalData
Iceland said it compared the price of the SMA products against “the same products available online” at supermarkets Tesco, Asda, Sainsbury’s and Morrisons on 26 February. The retailer added it also checked pharmacy chains Boots and Chemist Direct, as well as online retailer Ocado.
The price cut follows the UK’s Competition and Markets Authority (CMA) decision to launch an investigation into the country’s infant formula market after finding prices in the sector had jumped in recent years.
In November, as part of a wider look at competition in the UK grocery sector, the CMA said the average price of infant formula had risen by 25% over the previous two years.
Through the investigation, the regulator said it “will now be able to use its compulsory information gathering powers, rather than rely on firms providing information voluntarily”.
The majority of the infant formula sold in the UK is marketed by two companies – Nestlé and Danone.
Dr. Erin Williams, co-founder and director of the charity organisation Feed, praised Iceland.
“We call on other retailers and formula companies to follow suit,” she said. “The significant price drop in SMA Little Steps highlights just how much profit margin there is in this essential product, and is no comfort to families who have been driven to drastic measures over the past year.
“It’s an absolute disgrace that a supermarket CEO and his team are doing more to help struggling families than the UK government […].”
In January, French dairy giant Danone cut the wholesale price of its Aptamil infant formula by 7%.
Three ranges of Aptamil were to be reduced from £12 to £11.20 ($15.26 to $14.24) in Iceland’s stores.
The products included the 800g variations of Aptamil First Infant Milk, Aptamil Growing Up Milk and Aptamil Follow-on Milk.
