GAIA expands organic supermarket chain in Switzerland

Summer 2015: it’s hot and there are hardly any customers to be seen in the flagship store in Zurich that opened in June. But that’s about to change. Not only in the first organic supermarket with the Greek name GAIA (Mother Earth) but across the whole of Switzerland as the roll-out begins. The flagship store at Hohlstr. 484 – a busy street three kilometres north-west of downtown Zurich – is full of promise. Attractive, high-value shop fittings, well placed fresh food displays, regional products and a bistro that invites you to stay a while. The new building in which the 500 m² store is located is on the site of the former freight railway station in Altstetten, that has been built on and gradually upgraded. Jörg Brun, who developed the concept, is pleased that the launch of the store was a success and that now “all processes can be adapted to reality.” Data processing, the automated ordering system, the interfaces, the goods management system and ERP (Enterprise Resource Planning), software that has to be specially adapted for resource planning – everything has to bed down and teething troubles have to be dealt with. That’s why Brun is not worried that the number of customers in the first few weeks was not huge. 15,000 flyers were distributed in the district, but advertising was strictly limited.

Plans to expand beyond the Zurich region won’t please the two major players in Switzerland: Migros und Coop. Whereas Migros is the country’s biggest retailer and has, since 2012, been implementing an organic supermarket concept with Alnatura, Coop has been an organic player for around three decades. The market share of the two cooperatives together comes to approximately three-quarters of all organic sales in Switzerland. This means that the specialist trade has had an uphill struggle from the start of the development of organics. The intention of Jörg Brun and his eight colleagues is to see this change. In the land of bankers they want to invest the money of ecologically-minded and future-oriented families and offer an attractive alternative to investment in chemicals, industry and armaments.

Who is behind the new enterprise domiciled in Zurich?

GAIA was founded on the initiative of Valentin Wepfer. He is now president of the administration board. The managing director is Fritz Bärlocher, who used to be CEO of Coca Cola in Switzerland and before that was head of sales for Coca-Cola Erfrischungsgetränke AG in Berlin. In charge of business operations is Susan Gantenbein. As we learn from an article in the Swiss Handelszeitung, she has long experience in top management. Urs Fässler is head of finance. Nicole Dietiker, previously the head of customer marketing at Migros, is responsible for marketing and purchasing at GAIA. Noemi Koch-Cadosi, very well known in the organic scene in Switzerland, is an independent health adviser who operates as a freelance and runs seminars on nutrition for GAIA employees and customers. The company headquarters are located in Pfäffikon at the southern end of Lake Zurich.

The financing concept is based on investment between 100,000 and 500,000 Swiss francs by various ‘family offices’, in other words those administering the finances of wealthy families, (more information), with Urs Mantel from Bio Development AG acting as consultant. He too is based in Pfäffikon. 74 % of the organic wholesaler Bio Partner belongs to Bio Development AG.

A model of shop fittings and furniture

Although you can’t see much as you drive by, despite the big windows, when you enter the store you’re hit by the wow factor. The impression is one of tidiness and being well laid out. At first glance, you are aware that high-value materials have been used. Nevertheless, the store is not ostentatious or over-the-top. People who know about fitting out shops can see that the concept here is similar to that found in Rewes’ Temma stores. Interesting architecture with a big roughly 4m x 4m skylight means there is natural light throughout the store. Towards the back on the left you come to a big wine department with its own tasting station. Right at the back of the store is an area where you can try out natural cosmetics. Near the six tables in the bistro is a big screen that will show videos about manufacturers and tell customers about the provenance of organic food and provide information on the background to organics.

There are spacious storage rooms at three different temperatures for chilled products and one room for frozen products. This is where food items that are being produced in the store’s own kitchen and goods still to be processed are stored. It means that in the bistro, where salads, quiches, pasta pockets etc. are sold, they can react flexibly to customer demand. GAIA calculates approximately 1 million Swiss francs for fitting out each store.

Swiss suppliers preferred

In order differentiate itself from the Alnatura concept, that has also listed Swiss suppliers but is still unmistakably German, GAIA prefers, as far as possible, to buy from Swiss manufacturers. Biofarm supplies flour, rice and other cereals; from Putzli come mild and liquid detergents, rinse agents and dishwasher tablets.  Steiner Mühle packages around 30 articles – mainly cereals and flakes – and they are sold as own brand products. In the case of bread, bakery and dairy products and cheese, most goods by far come from Switzerland. Around 40 % of products in the dry goods range are of Swiss origin. Fine oils are supplied by the firm Montaniola. Other important suppliers are Regio Fair and, of course, the wholefood wholesalers Bio-Partner and Somona. The company does not sell air-freighted goods from abroad. 

Despite the impression of being in a high-end store the prices are not higher than you find at Migros and Coop. However, whether this price level can be maintained in the longer term is doubtful, because the big players have quite different purchasing conditions, enjoy considerable economies of scale and their logistics, that work at full capacity with their distribution of large volumes, operate at comparatively low cost.

Outlook: the company is planning to open more organic supermarkets between 2016 and 2019 on a line from St. Gallen in the east of Switzerland to Bern in the south-west and round the extremely prosperous Lake Zurich area. “From 2016, we’ll see a new launch every two months,” Jörg Brun declares. The company currently has its sights set on Basel and Zurich.