British conventional food retail enlarges organic range

Shoppers are growing less concerned with cost than they are about quality. Therefore, supermarkets are investing heavily in the organic food sector.

Tesco has announced to support organic dairy farmers with picking up the costs of organic inspection and technical support for organic dairy farmers for the next three years. Ever organic dairy producer member of OMSCo (Organic Milk Suppliers Co-operative) will receive around 400 British Pounds per year for the period of the next three years to cover the costs of inspection and technical support. Since organic milk sales are growing tremendously, the supply has to be secured for the customers in the country. Therefore, it was essential to support the next generation of organic dairy producers, the Trading Director for Chilled Food at Tesco stated.

Asda had been slow to respond to changing customer demands. Figures from market analysts TNS Worldpanel showed that across Britain it trails its supermarket rivals with just 8.4 % on the organic market, compared with Tesco (31.6 %), Sainsbury’s (27.1 %) and Waitrose (18.3 %). The company now has a 70-strong organic line, which should rise to 96 this year and to 130 lines by the end of 2007. The company’s organic produce buying manager is also keen to see more produce sourced locally and is working with farmers switching or considering a switch to organic farming. Asda is launching a campaign to encourage more farmers, particularly in Scotland, to follow.

Sainsbury’s recent figures showed that the surge in demand for healthy food helped to post a seventh quarter of rising sales. Customers had been shopping more frequently, up to three times a week, to stock up on fresh produce. Organic food had been moving into the mainstream with sales up about 20 % across the 430 lines the company stocked. Consumers had been concerned about price a year ago; they were concerned about quality at this time, stated Sainsbury's Chief Executive.

Retail Analysis
 
The Scotsman