Austria: Organic marketing is given impetus by new stores

The boom in organic supermarkets in Germany is being replicated in Austria. A large number of enterprises have been moving market development forward with large-scale specialist stores.  Even though it was the pioneer Stefan Maran who opened the first organic supermarkets in Vienna, there are now six companies that are in the process of building up organic supermarket chains.  Taking part in this new development are three firms from Germany, for which expanding into another German-speaking country is child’s play compared with investing in other countries outside their own borders. By now, Austria can boast around 20 organic supermarkets. The race for the best locations has begun!

Picture: Basic in Vienna (Basic AG/Jürgen Rosenbusch)

Basic’s appearance on the Austrian scene is the buzzword. On 14 June, the first store measuring 850 m² opened its doors in the Meidling district of Vienna, and more Basic stores are to follow in Graz, Salzburg, Innsbruck, Linz and other towns. However, as press spokesperson Sylvia Raabe in Munich has confirmed, leasing contracts have not yet been concluded. The company is anticipating two or three new stores in Austria in the course of 2007. Frau Raabe is pleased: “We had around 1000 customers on each of the first few days after opening, and we are delighted with that response.  We got a very nice welcome, and many local politicians were present at the press conference held before the launch.” She went on to say that the new store was reported very positively in all the media in Austria. The Bio Austria wholefood expert, Ralph Liebing, who is responsible for the specialist trade in Austria, takes pleasure in the fact that around 20 % of the range of 9 000 items comes from within the country. With its 15 stores and 521 employees, Basic achieved a turnover of 53 million Euros in 2005.

In Vienna, the market was already occupied by Stefan Maran and Alois Rosenberger, with four and two organic supermarkets respectively. On 25 May 2006, Maran’s company (Bio-Markt Maran) opened a fourth shop (picture) in Perchtoldsdorf, a suburb in the south west of Vienna. Up to now, the rest of Austria beyond the Vienna region has been considered relatively underdeveloped in terms of organic supermarkets. Not surprisingly, there are about 200 wholefood stores and around 150 health food shops spread over the whole of Austria, but large-scale specialist stores have been a minority.  There were exceptions such as Biohof Achleitner with its 350 m² store in Eferding to the west of Linz (www.biohof.at), the organic specialist store belonging to Hoflieferanten in Steyr (www.diehoflieferanten.at), EVI (Producer-Consumer-Initiative) in St. Pölten and Krems, and Unterm Hollerbusch in the town of Zwettl.

In June 2005, the first Denn’s Bio came to Linz, which is more or less in the middle of Austria. The 400 m² store is decorated in an attractive rich green. A second Denn’s Bio (picture) was opened in April 2006 in Wels, and another is to follow in the spring of 2007 in Salzburg. The company states that 20 % of the range at Denn’s Bio is of Austrian origin.

Through the company Dennree Wholefoods in Ansfeld near Linz, Dennree supplies around 300 stores in Austria. Dennree purchases goods worth about 10 million Euros from Austrian manufacturers, for whom it is also an opportunity to sell their products in Germany.

Livit (www.livit.at) opened a health food store with a large wholefood section in St. Pölten in February 2005 (picture below).  Though the Neuform company still does not accept it for Germany, the concept of whole food items on display side by side with Neuform goods was implemented in the stores opened in Wels and Linz at the end of 2005.

With a third "Biomarket" opened on 1. June 2006 (www.biomarket.at), Alois Rosenberger, who came originally from near Graz, risked the leap from the Austrian capital (picture) to the regional capital Graz (226,000 inhabitants), that is a good 240 km to the south of Vienna. He intends to open another store in Salzburg once the store in Graz has become well established. With his two stores in Vienna, Rosenberger is currently achieving a turnover of around two million Euros.

Mayreder’s Bio-Discount (health food and wholefood) opened its first store in Austria in Innsbruck on 23 March 2006. The store in Denzl-Park has a floor space of 650 m². The store is run by Ökonova (www.oekonova.de) in Sauerlach south of Munich. Over the whole of Germany, it runs nine Bio B. discount stores, and a cash and carry in Sauerlach itself. Since the company is a German operator without experience of Austria, there are still gaps in the range in terms of Austrian products, according to Bio Austria. Bioalpin reg. Genossenschaft m.b.H. in Tyrol (brand: Bio vom Berg) took the decision not to supply the store because it presents itself explicitly as an organic discounter. And this is despite the fact that people were pleased to see that a large organic supermarket finally opened in the Tyrolean regional capital (130,000 inhabitants). (Picture: Livit)

A surge in development is becoming apparent

In 2005 the Austrian wholefood retail trade experienced an average growth in turnover of 4% compared with 2004. In the first quarter of 2006, turnover increased appreciably, with the surveyed stores achieving growth of 10.8 %. The stores that have profited most are specialist stores of more than 150 m² that grew by 16 %, whereas smaller businesses grew by only 5 %.

The turnover barometer is adjusted to take account of shopping area, so that new stores and extensions to stores are recorded only in their third year. This method shows that the Austrian wholefood specialist trade is growing in terms of turnover much more than the stated 4 % (source: Friedrich Platzer Management Consultant www.friedrichplatzer.at). 

Floor space in the first quarter of 2006 has increased by more than 15%. Initial forecasts are pointing to turnover reaching around 90 million Euros this year, which is an increase of 12 % compared with last year. Thus the share in the total organic turnover in Austria is about 16 %. But despite good rates of increase, the specialist trade is struggling against the domination of the conventional retail trade, in particular Hofer (Aldi), Spar and Rewe (Billa). In 2005, the conventional retail trade achieved a turnover in organics as high as 320 million Euros, whereas the 80 million Euros of the specialist wholefood trade was just a quarter of this sum. (Picture: Basic Vienna)

“The specialist wholefood trade is one of the big winners in the food industry. Bigger and bigger stores in attractive locations are appealing to new categories of customer and will bring real movement in the market in the next three or four years” - Friedrich Platzer forecasts a successful economic future for the industry and even considers a turnover of 200 million Euros a possibility in 2010.

The specialist trade in Austria is celebrating its 25th anniversary this year with a PR campaign organised by Bio Austria. This will involve asking customers for the first time to choose the most popular specialist organic stores in Austria in three categories. A “Wholefood Gala”, at which the industry assembles and has a good time, is planned for the autumn.

General Information on organics in Austria:

www.biolebensmittel.at
www.bioinfo.at
www.bio-austria.at
www.vnoe.at

An overview of health food stores and wholefood stores:

www.naturverstand.at

More internet addresses for Austria:

www.greenpeace.at
www.global2000.at