Health Food Business Magazine

Itʼs about time mainstream retailers realised that stocking more organic produce, at a sensible price, will reap longer-term rewards.

During boom time, organic products were priced at premium rates by retailers. Retailers enjoyed the high margins but they inadvertently promoted organic as massively expensive stuff, or so it appeared to mainstream shoppers. Subsequently during these recession years, those highly priced products are now struggling to move from the shelf, therefore decreasing the demand and so impacting on organic farming worldwide.

Currently, on the journey from grower to distributor, organic margins are squeezed so much that many organic products and ranges are only 10-15% more expensive than their non-organic equivalents. And yet many mainstream retailers are still trying to keep their premium margins.

Elsewhere in Europe more and more mainstream retailers are stocking an increasing amount of organic and wholefood at discounted prices. They have realised that, if they adopt the same profit margins as they do with non-organic products, the natural choice of the consumer will be organic and wholefood, with the end result that those products move faster than before. For example, the Auchan Group in France with 340 jumbo discount stores are offering 100% organic fruit juices at the same price as non –organic. They reported that 30% of their previously non-organic shoppers switched to organic within 6 months. It only proves that, if priced sensibly, it works even in discount stores, benefiting everyone from farmer to manufacturer, retailer to consumer.

For those of us who really believe in protecting the environment, fair trade growing, ethical manufacturing, and true sustainability, it should be our mission to promote organic and natural at reasonable prices, to nurture organic farmers and producers. So we can all enjoy the benefits of organic growing, forever.

If we are genuine and willing, there are many ways of co-operating to promote organic. For example, in an attempt to drive the prices down, at Organic Village we are currently developing an on-line price comparison site where stockists can demonstrate their competitive prices. We can highlight individual products that are the same price as non-organic. A comparison on-line platform will also enable short- dated products to be shipped out to the end user to avoid wastage. By short dated, I mean 3-6 months depending on the product. In most cases suppliers are prepared to cut their prices almost by half because they are not be able to sell such short-dated stock to distributors or retailers.

In the food sector, unsold produce is then donated to charity (who wouldnʼt know what to do with 6 pallets of tomato purée). Through reputable on-line affiliates, those six pallets could deliver 3000 jars of tomato puree to 3000 consumers across the UK, at cheaper than standard non-organic prices. Which one would you buy, especially when itʼs delivered to your doorstep?

We believe that reducing the margins of mainstream retailers would result in increased consumer demand, thereby truly sustaining organic farming.

Cengiz Aytacli, Organic Village
Representing 753 organic fruit growers of Anatolia, Turkey.