Wal-Mart strategy should improve organic outlook

Brian Rohter isn't worried about the world's biggest retailer jumping into the organic-product market. In fact, the CEO of Portland-based New Seasons Market thinks it's a great thing, reports The Business Journal of Portland. New Seasons Market operates seven natural food supermarkets in Oregon.

The multiple Wal-Mart Inc. announced end of March 2006 that it will carry more than 400 organic products by this summer in select stores. The move is part of a larger companywide initiative to incorporate sustainable business practices. It's also a strategy to meet consumer demand, as more people are buying organic food due to health and environmental concerns.
Rohter from New Seasons Market says his store already competes with Wal-Mart on some products and is "doing fine." "If we want to mainstream sustainable practices in farming and agribusiness, Wal-Mart is the quickest way to get down that road," Rohter said.

66 % of U.S. consumers reported in 2004 that they use organic products at least occasionally, according to a study by Bellevue research firm The Hartman Group Inc. That's up from 55 % in 2000. According to the Organic Trade Association (OTA) says annual sales of organic products in the United States leapt from $1 billion in 1990 to $15 billion in 2005.
Wal-Mart has more than 6,200 stores worldwide and 68,000 suppliers.

Competitor Safeway Inc. is also making inroads. It rolled out its own brand of 150 organic products in December. The "O Organics" line sells for prices comparable to nonorganic counterparts.