

June 16, 2009
Offering organic 'a great way to grow' for grocery stores
Pittsburgh Business Times
Offering organic food was hip for grocery stores years ago, but nowadays
it is a commonplace reaction to the requests of customers who want healthy,
green choices.
“When we bring in a new product, we are responding to the needs and desires
of our shoppers,” said Rob Baran, general manager of the East End Food
Cooperative in Point Breeze.
“Customers were asking for organic curry leaves, so we added them in
February. We’re also hoping to add more organic dairy products this year.”
Information provided by the Organic Trade Association in Greenfield, Mass.,
shows grocery stores are responding to the demands of their health-conscious
customers by offering a wide selection of organic foods, such as fruits,
vegetables, meats, eggs, snacks, cereals, dairy items, beverages and more.
Statistics compiled by the OTA reveal that consumer sales of organic foods
and beverages in 2008 topped $23 billion, accounting for more than 2.8
percent of the total U.S. food sales.
“I don’t think grocery stores are under any pressure today to offer organic
products, but I believe it presents an opportunity for growth,” Baran said.
“Organic is a great way to grow because it’s been one of the fastest-growing
segments in the industry for a long time.”
Baran said the sale of organic foods at the co-op dipped by about 10 percent
during the period from November to January as a result of the economic
slump. However, the market has been improving and sales growth of 15 percent
to 20 percent per year is typically the norm.
According to Baran, sales of organic foods will continue to climb as more
people become educated about the benefits of making healthier meal choices.
A survey conducted by the co-op in 2007 found that 58 percent of the
shoppers visit the store specifically to buy organic food, and the average
age range of the largest segment of shoppers is between 36 and 50.
Baran said the most common demographics he has noticed among individuals who
buy organic foods are that many of them have a college education and a
higher-than-average income level. The price of organic foods is often a
talking point during discussions about these products on news programs and
in magazines.
For instance, Baran noted that organic bananas can cost between 99 cents and
$1.29 per pound, while a gallon of organic milk can be around $6.99.
Dan Donovan, manager of corporate communications for Giant Eagle, said
customers’ interest in organics continues to grow despite economic
conditions and higher prices.
Rather than seeking out retailers that feature only a specialized selection
of niche foods, savvy, health-conscious consumers are increasingly looking
for natural and organic options when making regular food purchases at local
supermarkets, Donovan said.
“Giant Eagle has seen steady growth in the category,” he said.
“Over the past 12 months, more than 1 million customers have purchased
organic produce items. Likewise, nearly half of all Giant Eagle customers
have purchased a natural or organic item in the last year.”
Donovan said it is important for grocery stores to call attention to the
fact that they provide a selection of products. Giant Eagle features as many
as 34 types of organic fruits and 71 varieties of organic vegetables and
bagged salads.
A spokesman at the local Trader Joe’s in East Liberty referred inquiries to
the store’s West Coast office.
Alison Mochizuki, director of national publicity, said the amount of organic
offerings at Trader Joe’s locations frequently fluctuates, but is currently
at about 20 percent.
“We urged many of our suppliers to get certified as organic,” she said.
“Listening to our customers, we could feel the wave building.”
Where we stand
“As in the other markets in which we operate, many Pittsburgh consumers are
increasingly becoming more health-conscious with an interest in natural and
organic options.”
Dan Donovan, manager of corporate communications for Giant Eagle
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