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The Baked Bean Journey & Food Costs

October 27, 2015 Money Matters No Comments

The Humble Baked Bean…4000 miles and counting!

Everyone recognises the Heinz baked bean. But, what most consumers don’t recognise is the rather extensive journey our beloved beans undergo in order to reach our households in the Channel Islands.

We can purchase a can (415g) of Heinz baked beans for an average of 72p in the shops across Jersey. To some, this still remains a price subject to of the now constant criticism ‘well you wouldn’t pay that in England.

The fact of the matter is our little bean has a great distance to travel in order to satisfy consumers in both the UK and the Channel Islands. Along this estimated journey of over 4,000 miles and counting, the commodity is subject to numerous taxations, dues and other cost-incurring procedures which impact on its final price.

Heinz beans must first be traced back to the US where they are planted by local farmers for Heinz, picked and then packed for transportation to the UK in raw form, all of which generate contractually agreed costs. On their departure from the US, they are subject to a Harbour Due. These are various charges incurred in order to cover maintenance of the shipping channels, lights and buoys, and tug services. Later, the allocated transport carrier is charged the shipping freight covering the completed journey to the UK. The shipping will include crane charges, transport to the harbour and the container hire!

On arrival into the UK, the beans are subject to a second Harbour Due along with a taxation that affects all products coming in from outside of Europe called CCT (Common Customs Tariff). Duty payable on beans is 17.6% of the cost of the goods plus the freight costs. This must be paid for by Heinz before they can continue on their journey. Once cleared, the sacks are transported by pallet loads in containers to the Heinz UK factory in Wigan. The factory is where the classic Heinz sauce is prepared and the beans are finally cooked. The preparation of the sauce is another process which incurs a multitude of costs. Hazard analysis, checking raw products for infection and temperature monitoring are only a few of the pricey procedures preceding the costs of labelling, canning and storage before beans coming to Jersey are finally ready to leave.

Heinz UK negotiate with Jersey stores through their buying group and the newly sealed Heinz beans are once again loaded and transported down South, where they must, once more, receive Harbour Dues when leaving Portsmouth and on arrival in Jersey. Depending on quantity, the Ports of Jersey will charge £8.80 per tonne of freight arriving in Jersey, a figure set by the States of Jersey. Upon arrival into Jersey the beans must be cleared at customs whereupon they will either go to wholesalers or large supermarket chains in Jersey who will be registered for GST. Consequently the goods are not charged GST at import but fast-tracked to the retailers and GST is charged at the point of sale.

Our research has shown that the key to keeping costs to a minimum in the baked bean journey is for all the businesses involved to focus on super efficient logistics at every stage.

So, it would seem getting a tin of Heinz baked beans to Jersey proves to be quite a costly job. We must ask ourselves, how is it that our beloved bean can remain as cheap as 72 pence when its journey is subject to different charges at all different touch points? Which part of the 70 odd pence we pay at the counter contributes to the taxation, dues, storage and preparation costs of our Heinz baked beans’ journey?

Thanks to Heinz, the Cooperative and the Ports of Jersey for their help in researching this article.


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