NASHVILLE — Executives from Food Lion, The Fresh Market and Giant/Martin’s discussed what would help them sell more organic produce during a panel Sept. 7 at the Southern Innovations Organics & Foodservice Expo.
The retailers began by describing their respective approaches to sourcing and merchandising organic fruits and vegetables.
Chris Dove, vice president of produce category, merchandising and pricing for Food Lion, said some of his stores integrate organic produce into the department and some segregate it. Food Lion locations include many different formats because the chain has evolved over the years, with more than 1,000 stores. Dove said segregation for organic is preferred when possible and highlighted with overhead signage and blades.
About 6-7% of the produce Food Lion carries is organic, and price is key because the chain wants to bring shoppers product that is fresh and affordable, Dove said.
However, he forecast continued growth — in five years Food Lion produce departments could be 15% organic instead of 6-7%.
“Even a very value-minded consumer wants organic items,” Dove said.
Giant/Martin’s puts a heavy emphasis on its Nature’s Promise brand in its department, said director of produce and floral Chris Keetch. By using that label, stores can easily have a recognizable organic presence in departments throughout the store.
Giant/Martin’s does a mix of integrating and segregating, sometimes simply based on floor space available. If organics does get a separate section, demographics determine the size. Keetch, too, prefers to segregate the organic produce when possible.
“It’s becoming a destination set,” Keetch said.
He noted that about 10% of Giant/Martin’s produce is organic, and he projected the segment could grow to 15% or 20% in the next five years.
Vic Savanello, vice president of produce for The Fresh Market, said his company aims to make food exciting rather than make food inexpensive, so he is willing to offer pricier, top-shelf items if they help stores deliver on that goal. About 25% of produce offered by The Fresh Market is organic.
He looks to source organic first for any fruits and vegetables that are not core, high-volume items. The idea is that instead of offering conventional and organic options and having some shrink for both, stores can offer just the organic option, have less shrink, and offer that organic option at a bit lower price than they could otherwise.
Savanello said the biggest opportunity he sees for growth in the category is the addition of organic versions of the best-selling value-added products.
Keetch concurred, also mentioned value-added. He noted that organic fresh-cut is difficult for retailers to do in-house because they need to have a separate back-room operation.
Dove described consistency of supply for organic throughout the year as another opportunity.
Keetch noted that suppliers can also add value for retailers by providing insight on what products and services are trending around the country. This information can be especially useful for chains with stores in regions that trends typically take longer to reach.