Development Of Organic Supermarkets In London Gets Underway Again

When the first organic supermarket started up in November 1995 in England, it was regarded as a sensation. A big number of media reports continued over a couple of years. Competitors wondered what they could do to keep up. In 2000, by which time there were eleven sizeable stores in London, it looked like a boom in specialist shop start-ups. That first organic supermarket, Planet Organic was founded in London with 500 m² of selling space by Renée Elliott (picture).

She announced that she wanted to create a chain of 20-30 stores within a few years. Her next shop with 400 m² followed in June 2000. Her third organic supermarket was set up in July 2004. Today there are about one dozen whole food supermarkets in London. In fact, by 2005 these enterprises had wanted to be further on in their development. What happened?

After the enormous annual growth rates of 30 % and more at the end of the 1990s, not only did a number of firms enter the market by creating specialist stores, but  the conventional food retail trade, with Sainburys, Waitrose, Tesco and Marks & Spencer in the lead, extended its selection of organic products considerably. This obviously resulted in an oversupply of such products on the market. The increasing competition led to the closure of some whole food specialist shops like Sundance and Naturally after a short time. Planet Organic, Fresh & Wild and As Nature Intended (picture) postponed their expansion plans. All three had planned to open quite a lot of specialist whole food stores over a few years. Ten years after the first organic supermarket opened in England, this industry in London, with its seven million inhabitants, is still at the same stage of development as in 2000. And the eleven specialist stores belonging to the three retail chains are rather small with their 200-500 m², bearing in mind that 12.6 million people live in greater London (in comparison to Germany, where there are more than a dozen shops with 1000 m² retail space or more).

In the financial year 2004/2005, Planet Organic (link: www.planetorganic.com) grew by 20 % and produced a turnover of approximately 10 million Pounds Sterling (14.7 million Euros). Managing director René Eliott attributes this not only to the third shop, which was established over a year ago, but also to the growth in demand. This is why she is again planning to open more shops in the future - one in 2006 and then two more each year. “We would like to have ten stores in London” is how the 41 year old Renee Elliot describes her target. However, the problem is finding affordable retail premises. “In principle the supply exists, but at British Pounds 300 per year per square metre (38 Euros/month) it is too expensive to make a profit.” is Renee Elliott's opinion. She adds to this the fact that the locations are not in the high street in the various parts of town but some distance away, like the third premises of Planet Organic in Fulham in south west London. The store is only one minute from the underground station and thirty metres from the high street, but you cannot see the shop from there and you have to know where to find it.

The American Renee Elliott is one of four directors. Her areas of responsibility are development of the product range and staff training. By now 120 full-time and part-time employees work in the three shops and in the administration. “We carry out regular training and further training for all our employees,” she explains. Her husband (47 years old) joined the management a few years after Renee Elliott became a managing director.

The three Planet Organic stores stock 9,000 products, of which 5,000 are food items. By now, 90 % are organic which is approaching the upper limit. “We can't get organic fish, algae, gluten free noodles and special cereal bars,” is her explanation. Whilst Irish salmon with organic certification is available on the cold shelves, they try to ensure that the other pre-packaged fish on sale is from unthreatened species.

The big cosmetics and food supplements department and a bistro are integrated parts of the Planet Organic concept. In the bistro various dishes of the day, salads, cakes and juices, await you or are prepared for you. Freshly pressed juices mean there are many fruit and vegetable mixtures available. 22 juices are on sale, ranging from apple, orange, carrot and ginger to juiced wheat grass (picture). The bistro can seat around 30 people, and the windows from floor to ceiling invite the customer to sit and look out into the street or to read the newspaper in a comfortable ambience. The busiest times are the lunch hour and in the afternoon after mothers have fetched their children from school or kindergarten. The well laid out and inviting fruit and vegetable department is located near the entrance. There is no fresh meat counter as in the first store in Westbourne Grove. There is only a limited stock of packaged meat.

In cosmetics (picture), you notice a high proportion (20 %) of products manufactured by German companies: Dr.Hauschke, Lavera and Weleda have a wide range of products that are readily bought, according to the lady in charge. In the natural remedies section you find a wide selection of products by the Swiss firm Bioforce Dr. Vogel. English companies producing skincare cosmetics are Green People and Ren Skincare that each manufactures a wide range of shampoos, skincare, deodorants, toothpaste and babycare articles.

The second shop in the future retail chain, As Nature Intended (www.asnatureintended.uk.com) was opened in April 2005. Founded by the owner of the multiple Iceland retail food chain, the first shop opened in June 2000 in Chiswick in west London. The second was opened in the high street of neighbouring Ealing (west London). A number of years ago, the daughter of the founder, Caroline Walker, took over the management. More stores are to be opened at the beginning of 2006, also in London.

The Ealing store (picture), with 220 m², has well stocked 1.7 m high shelves. With around 7,000 items, 80 % of which is food, the range is extensive. The company's own internal evaluation showed that 94 % of food originates from organic production. Big colour posters provide information and create a pleasant environment in the approximately 4.5 m high interior. Customers can shop here in this attractive specialist store from 8.30 in the morning to 8 o'clock in the evening every day, but with restricted hours on Sundays. This means a lot of staff. The manager Stephen Bush has 38 employees under him, with nine working full-time.