Supermarkets lose out to independent retailers in growing organic market

By Leah Vyse

- Last updated on GMT

Related tags Organic food

Organic food sales in the UK are growing by £2.3 million (€3.2m)
each week but supermarkets' share of the thriving £1.2 billion
market is falling as consumers turn to local producers, says a new

Growing consumer demand for healthier, locally sourced products in the UK has led to an 11 per cent increase in demand for organic products over the last year, an annual audit of the UK organic retail sector by the Soil Association revealed.

But consumers are increasingly turning their backs on supermarkets in favour of buying directly from farmers and independent retailers in a bid to ensure they know the source of the produce, the report said.

Sales of organic products through box schemes (where farms deliver seasonal produce direct to customers), farm shops and farmers markets' increased by 33 per cent in the last year, while independent retailers saw the biggest growth in sales - a massive 43 per cent.

Yet the percentage of organic sales made by supermarkets fell for the third consecutive year from 81 per cent to 75 per cent.

The Soil Association's director, Patrick Holden said: "Increasing numbers of people are eager to buy local to obtain the freshest organic food possible and to cut down on the environmental pollution caused by 'food miles', which is good news for small local producers."

However the director of Organic Monitor, Amarjit Sahota, told​ that the falling market share of the big retailers was also due to their reduced product range.

Sahota said that many supermarkets have stopped selling a lot of organic products. They have pulled less successful ranges such as processed and frozen foods and chosen to focus on the core, and more profitable, fresh organic products - fruit, vegetables, meat and dairy, which will put them in direct competition with the farmers and independent retailers.

"Supermarkets have reduced their organic product range. Tesco for example previously had 1400 products in their range but now they only offer between 1100 and 1200 products,"​ he said.

Sahota also notes that people who buy from supermarkets look for convenience whereas those who buy from smaller independent retailers look for provenance.

"Consumers buying from supermarkets are not so picky which country produced it. Those buying from organic shops and farms are very concerned, it is a priority for them."​The new figures indicate that consumers are concerned about sourcing and food miles and may put this before obtaining more readily available and often cheaper products from the one-stop-shop retailers like Tesco.

The audit also revealed that organic products are selling at a faster rate than their non-organic counterparts.

And analysts predict that supermarkets, whose sales still account for £913m of the organic market, market share will continue to slowly decline.

Sales value is still increasing at supermarkets but at a slower rate than independent retailers.

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