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Supermarkets dig in for organic food battle

Susie Mesure,Retail Correspondent
Tuesday 29 August 2006 00:22 BST
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Organic food, normally associated with liberal pacifists, has become the latest battleground in the UK's supermarket wars, with J Sainsbury and Waitrose each vying to out-green the other ahead of national organic fortnight, which starts next week.

Both chains like to see themselves as organic pioneers, fighting over the accolade of being the UK's first supermarket group to have offered customers organically grown produce: Waitrose says it launched the genre in 1983, while Sainsbury's claims it has made the category its own since 1986.

Both groups punch above their weight in the organic sector, although again Waitrose insists it lands a harder blow. The smaller chain, which is owned by John Lewis Partnership, says that despite only having a 4 per cent share of the UK's grocery market it controls four times as much of the country's organic grocery sales. Meanwhile, Sainsbury's has 30 per cent of the organic market, twice as much as its share of the overall grocery market.

Shoppers are increasingly keen to trace the provenance of their food, demanding more than just ever-cheaper prices. This has catapulted the organic sector from a niche market into the mainstream in just a few years. The Soil Association, the leading certification body, recently predicted the £1.2bn sector would be worth £2bn by the end of the decade.

Sainsbury's is attempting to stretch the market by expanding its organic range into ready meals for the first time. It is adding pizzas and soups to its SO organic own-label, which it relaunched last year. It has tripled the number of organic lines that it stocks during the period to 1,000.

But Waitrose intends to do better. From next month, when it will relaunch its own range, customers will be able to complete "100 per cent" of their weekly shop organically. It says its range stretches to 1,500 lines, including meals-to-go and snacks.

Data compiled for Sainsbury's by AC Neilson show that the chain enjoyed a 18.4 per cent leap in annual sales of organic food in the 12 months to July.

The other front to open up in the organic supermarket wars is between Tesco and Sainsbury's, who are both launching organic produce box schemes within days of each other. Both groups are testing the market for an online box scheme, replicating the existing offers in the market from small companies such as Abel & Cole and one-man bands who source directly from local farms.

Even Asda has got in on the organic act. Its parent, Wal-Mart, recently announced plans to raise its own organic game in a move that has worried the US organic food movement. Andy Bond, Asda's chief executive, is going to announce a new series of sustainable initiatives tomorrow.

Ronnie Cummins, of the Organic Consumers Association, a US lobby group, is among those who are concerned Wal-Mart will destroy the ethical ideals of the movement, which is more devoted to eco-friendly practices than the bottom lines of the world's biggest retailers.

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