Progressive Grocer - October 2009 - (Page 96)

2009 Produce Operations Review Organic Observations Despite the inroads organic produce has made in recent years with better quality, more availability, more competitive pricing and increased numbers of both true believers and neophytes, several supermarket produce officials responding to this year’s Produce Operations Review said the current economic downturn has had palpable effects on organic sales. A sampling of the following verbatim responses revealed below helps shed more light on their viewpoints: Q. Have sales of organic produce been affected by current economic conditions/rising prices? Yes 57.9% No 42.1% Q. Has the economy affected organic sales? Yes “Organic produce sales decline when the cost difference exceeds 10 percent.” “The higher cost does not translate into greater value for most consumers.” “Customers are choosing to go with lower-cost products across the board.” “Customers are trading down from organic to conventional.” “Customers have demonstrated a willingness to bypass organics to stay within a budget.” “Organics is a high area of shrink for us. People say they want organic, but unless it’s priced within 5 percent of conventional product, it is often overlooked, and I can use the space for things that do sell.” “Our community has been [hit] hard by the housing slump, with less money in the community, so organics have fallen out of favor with many of our customers.” “People are saving where they can, and the non-organics are an easy way to save.” “Our organic produce sales are definitely down due to the economy.” “Families that have to make a budget are looking to ways to cut cost, and organics are eliminated as one area for them to do it, since the average $3.99 retail price for an organic bagged salad stands out vs. a conventional $2.99 to $3.69 price point.” “Higher prices on organics means lower sales — everyone is looking to save money.” “Sales have declined — organics are a luxury, not a necessity!” “The varieties of organic greens have declined in sales somewhat, but organic fruits have slowed down dramatically.” “There doesn’t seem to be as high a demand as there was six months ago. People don’t have the money to buy these items as much as they did in the past.” “We do less in organic — moved back to mostly conventional regular produce.” “We have noticed a slight drop-off of organic product sales in areas impacted by the recession, particularly in our Manhattan stores.” “Trends have forced customers to switch to less expensive items.” “We are in a small area where organic produce appeals to a certain clientele, so we can’t justify making a big commitment.” Q. Has the economy affected organic sales? No “We’ve seen a slight decline, but our organics are holding their own.” “Somewhat, but as time has gone on, the prices have come down and the growth is returning.” “Our organic produce sales are still growing, but not at the astronomical rate prior.” “We saw a dip in organic sales and felt it was due to the economic situation. However, we decided to merchandise organics in clusters and increase our ad activity, and we are now trending ahead of last year.” “We are holding the line on organic pricing and doing OK.” “It seems that the organic customer will pay a little more. The borderline buyers have changed.” “There are limited organic produce suppliers in our area.” “They were stable with last year, so we expanded our selection by 20 percent and it has picked up some.” “The push on organics has been slowed, not by prices, but by the new push toward buying local.” • Progressive Grocer • October 2009 A H E A D O F W H AT ’ S N E X T www.progressivegrocer.com http://www.progressivegrocer.com

Table of Contents for the Digital Edition of Progressive Grocer - October 2009

Progressive Grocer - October 2009