Changing Organic Landscape

When we look at Whole Foods Market, we think “big”, the truth is that it’s all a matter of perspective. Sure, Whole Foods is big; after all, 440 stores in the US is nothing to sneeze at. But compared to the nearly 3, 500 Walmart Super-centers and 2, 400 Kroger-brand supermarkets in America alone, Whole Foods is relatively small. Add home delivery options like Amazon or meal delivery services like Blue Apron and suddenly you’ve got a mid-level grocer in distress—scrapping plans to expand, and closing stores all across the country.

With large grocers increasing their offerings in the organic-and-natural-food market at a cheaper price, it should come as no surprise that the notoriously expensive Whole Foods (dubbed by many as “Whole Paycheck”) has felt a hit—and they are not the only organic food chain that is struggling. Smaller rivals like Sprouts, Fresh Market, and Fairway have all seen plunging stocks this year as well. The solution—for Whole Foods, at least—is to start with store closures in the smaller markets, and lower prices across the board. They are also attempting to grow the larger markets with a new chain: 365 by Whole Foods, a smaller, cheaper option for those who want to buy organic. Additionally, the chain is partnering with a private consumer data subsidiary of global grocery giant Tesco in an attempt to use customer information to improve merchandising and personalize offers to loyal shoppers. So what does this mean for the smallest of purveyors, like South Shore Organics? Well, for starters, we can’t deny that any grocer or food delivery service (big or small) is potential competition.

Whether folks are shopping at another local market or getting pre-packaged meals from meal kit services, the fact is that we saw our first dip in sales last year. It’s left us wondering whether our community is seeing the trickle down impact of these large grocery stores, and how we are supposed to sustain our business model in the face of such competition. We are one location to their many; we don’t mine consumer data for trends; and above all, we believe in helping our customers feel a stronger connection to their food. From its very inception, South Shore Organics has been on a mission to provide clean food from sources that support family farms and food production. This means getting produce from local farms year-round.

But we still compete with bigger companies who merely pay lip service to what is our primary focus and core mission. Companies for whom “supporting farmers” means getting farm-fresh produce at the lowest cost while offering farmers 90 days payment terms. A large proportion of processed food sold under the organic label (everything from frozen carrots to chicken nuggets) is imported, and largely from China. We understand that shoppers want high quality at an affordable cost. This is why we strive to offer the best produce around, while keeping our prices competitive. In fact, our regular price checks against chain grocers and local markets in the area consistently demonstrate that we offer the most local and organic produce for the lowest cost, and we are very proud of that—especially since we are only one small, locally-owned business with fewer resources at our disposal to do our good work and make a positive impact within our community. It is both challenging and frustrating to go head to head with many of the super-centers, meal kit companies, and cheap organic brands for ‘organic dollars’ when they will do whatever it takes and make (environmental and ethical) compromises, while we, the scrawniest, scrappiest kid on the block with hardly any muscle, stand steadfast, refuse to make compromises, and cling to our food ethics and mission.

We have seen a lot of change this year. Many farmers are no longer offering CSA’s, and have reduced their commitment to Farmers’ Markets this season. On a local, small farm level, many of us are feeling the contraction. With existing stores expanding their offerings and many new ways to think about, cook, and consume food coming to market, other, larger brands like Whole Foods are feeling it too.

It is going to be interesting to see how the landscape is affected over the next few years, and see who will survive. I hope like hell it’s us, others like us, and our small family run farms. Otherwise, who will we trust to do the right thing?

“Putting Things Into Perspective.” Berkshire Organics – 24 Feb 2017.
Barth, Brian. “Meal Kit Mania, Unpacked.” Modern Farmer – 16 Nov 2016.
Peterson, Hayley. “Whole Foods is Closing Stores: See if Yours is on the List.” Business Insider – 9 Feb 2017.
“Whole Foods is Closing Nine Stores After a Year of Sluggish Sales.” Reuters: Fortune – 9 Feb 2017
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