More Than Meets The Eye

By Jim Prevor, Editor-in-Chief, Produce Business

It is one thing to see increases in the sales of organic produce; it is another thing entirely to understand why those numbers are moving up. One big trend is for supermarkets to reduce the number of SKUs carried. One way of doing so is to carry only organic versions of low-volume items. This reduces the number of warehouse slots, vendors and, in general, simplifies the entire operation. Since the organic-preference consumers are getting an organic product, they are satisfied, and the conventional shoppers mostly don’t care if the item is organic. So organic sales get boosted without increasing intent for consumers to buy organic.

Merchandising practices also impact organic sales. The trend has been to integrate sets where organic produce is sold alongside its conventional equivalent. Most stores that switch from a segregated set to integrated report an increase in organic sales. This scenario might mean consumers, when confronted with both organic and conventional, opt for organic. It also could mean consumers don’t pay much attention; they see beets or carrots, know they want them, and grab the first they see — accidentally picking up organic.

The spread of organic produce, often to farmers markets, CSA boxes, or similar outlets, may or may not be true. How many consumers check for the USDA Certified Organic signage at the farmers market? How many assume everything at a farmers market is organic? Even if a farm has such a certificate, what are the controls that guarantee a consumer the product purchased in a farmers market is actually grown by that farmer and covered by that certificate?

PRODUCE BUSINESS conducted quite a bit of research on local, and we found it to be a sticky wicket. In the first place, consumer responses are not uniformly in favor of geographically local produce. They like local when the local region is traditionally an appropriate place to grow an item. But if “locally grown” translates into inauthentic growing regions, it is not so hot.

Often local has a political tinge to it. No matter how narrow the English Channel, people in Britain do not mean French when they are thinking local produce — they mean British.

It is also to be noted that local is trendy and perceived as a good thing, so supermarkets may find ways to show they are selling lots of local stuff. But if the stores happen to be in California, and the chain defines local as grown within the state, they will be selling lots of local — but they were doing that 10 years ago, too.

In any case, there is little evidence that the mass of consumers want to give up year-round availability of almost everything. It is easy to eat local; but to be truly local year-round, you have to be willing to give up tropical, only eat seasonally, and store the root cellar potatoes and turnips for winter. Despite all the publicity, the trend is toward a more international trade of produce — not less.

One of the big problems in life is people believe things that may not be true. So people may assume a farmers market sells produce that is “fresher.” When in reality, supermarkets have elaborate programs to maintain the cold chain and thus product quality. Many a vendor at local farmers markets participates on Monday, then loads everything in the pickup and heads to another town for another market on Tuesday. If by fresh, one means of high quality, this broken cold chain is unlikely to deliver the desired result.

Even things that seem obvious may not really be so. It is widely accepted that the premium for organic produce is a big obstacle to increasing organic sales. Yet price is part of the elaborate signaling system that helps signal quality to consumers. If magically, organics suddenly became cheaper than conventional, perhaps consumers would not be so quick to assume that organic is better — they might only want the expensive stuff for their babies.

Every store is promoting organic, locally grown, regional, Product of the USA … and every survey reports consumer interest in these topics. Perhaps, however, it is all the marketing attention that creates consumer interest, not vice versa.