After ceding the spotlight to local for the past few years, organic may once again be having a moment.
Even McDonald’s is looking at organic for some products in certain markets, president and CEO Don Thompson told investors in an earnings call earlier this week.
In the grocery world, Aldi’s U.K. stores have begun stocking organic produce that the retailer says costs 25% less than such products elsewhere, the Daily Mail reports. While Walmart similarly has made a play for lower cost organic items by carrying Wild Oats products, Aldi’s focus on produce gives it an even greater opportunity to reach new consumers: Studies have found that produce tends to be the main gateway for consumers purchasing organic for the first time.
Here in the U.S., Salt Lake City-based Associated Food Stores has seen dramatic increases in demand for organic produce, particularly in certain categories, Leigh Vaughn, senior category manager for produce, told participants in Supermarket News’ recent webinar “Managing Change and Building Relationships in Grocery Supply Chain: Associated Food Stores and Robinson Fresh.”
“We’re actually working now with some of our suppliers to discontinue some conventional items and carry them only as organics, in the greens area and things like that, because they are just exploding. We’re experiencing 27% to 30% increases in just our organic kale alone,” said Vaughn.
The webinar presenters cited a couple of factors for renewed interest in organic. First, the improving economy means consumers are spending more and thus are more likely to purchase pricier organic items.
There are also simply more organic products available, and customers have more options of where to buy such items.
At the same time, organic may face supply challenges down the road. The Organic Trade Association has said that there needs to be more acreage devoted to organic crops in order to meet demand.
During the retail tour at the Produce Marketing Association’s Fresh Summit Convention & Expo in Anaheim, Calif., earlier this month, representatives from a Costco store in Tustin said it was sometimes difficult to get organic produce at the volume they need. Despite that obstacle, organic is a growing category for the store.
Whatever the location or store type, it’s clear retailers of all stripes should be taking a closer look at organics.
Editor's note: This Viewpoint originally stated the Costco store was located in Irvine, Calif. It is located in Tustin, Calif.
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