In the Trenches: Organic produce still has challenges to overcome

by Ron Pelger | August 17, 2018

The produce industry has been moving forward at a rapid pace in the past several years. Extensive progress has been skillfully accomplished in several prime categories, especially in the fresh organic produce arena.

According to the Organic Produce Network and Nielsen data, organic fresh produce sales were close to $5 billion in 2017, which was an 8 percent increase over the previous year. Organic fresh vegetables accounted for $2.4 billion in sales, a 6 percent increase; and organic fresh fruit sales accounted for  $1.6 billion, up 12.6 percent.tru2

With this positive category growth in mind and as produce department organic sections continue to expand, there are still a couple of challenges hanging around and haunting the merchandising sector — specifically, how to best display and identify organic produce.

Age-old (well, as aged as they can be) questions still abound. Should it be integrated or segregated? Should it be loose or packaged? Should it have colored “organic” stickers or no stickers? Should it be priced higher or the same as conventional?

Despite the fact that organics have had to jump through so many proverbial hoops, its growth has been phenomenal. And yes, organic produce is still going through growing pains that will eventually be resolved.

“Organics are in their infancy and there is little chance of it running out of gas,” said Matt Seeley, co-founder and chief executive officer of the Organic Produce Network. “I think the simplest answer is to listen to the customers. Organics are being driven by millennials. This demographic wants to know where their food is coming from, how it was grown, what it is doing to their bodies and how it is impacting the environment. Look no further than millennials with babies and what they are feeding their children. Walk down the baby food aisle and you clearly see it is nearly all organic products. This is what they are feeding their children and what this generation will expect their food to be in the future — organic.”

Yet the question remains, how organics should be merchandised?  Integrated with conventional produce or segregated in its own designated section?

The answer lies within the decision makers of supermarket companies. In my opinion, it should be segregated into two sections. All organics requiring refrigeration like lettuce, mushrooms, berries and broccoli should be placed in its own refrigerated wall case section. Tomatoes, bananas, apples, citrus, melons, grapes, potatoes, onions and the like should be displayed nearby off of the refrigerated case.

“Before we answer the question of whether or not we should segregate or integrate organics, we should consider how we can best manage the cool chain,” said Anthony Totta of FreshXperts, based in Kansas City, MO. “We must do so in a manner that maintains the taste and texture of each commodity. If we are successful in keeping tomatoes, cucumbers, peppers and eggplant in the proper temperature zone, we will then easily answer the question of whether we segregate or integrate. We must let what’s best for the items to dictate the department set.”

This takes us to the second challenge — identification of organic produce items. What is the program at this level?

It’s puzzling as to why so many supermarkets place all those “organic” stickers onto each and every loose organic item like apples, lemons and tomatoes. It blemishes the overall visual appearance of the entire organic display.

As a former produce director, I could certainly understand wanting to protect the gross profit, but we are ruining the presentation at the same time.

The majority of shippers are affixing organic PLU and bar code decals on the loose items. Adding more stickers to the product already stickered is senseless. On top of it, the labor for an employee to place more stickers on each apple and orange is a waste of time and labor. Then we complain we don’t have enough labor to get the job done in the department.

Whether it’s labels, stickers or decals, we need to get past this part of the organic merchandising movement.

“At the end of the day, the label that means the most to the consumer is the USDA Organic label,” said Seeley. “That label means certain rules and regulations have been followed for this product to be branded as organic. The USDA organic brand is trusted and powerful. It needs to be a part of any successful branding or sticker program.”

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