Organic and Natural Foods Go Mainstream

Implications: Large consumer packaged goods companies are finally waking up and embracing the volume opportunity in Organic and Natural Foods.For years ,most of the top selling products at Whole Foods and other Natural stores were made by small manufacturers.Large CPG companies were not quick to offer products because the volume was still small and there are greater difficulties in the manufacturing process to produce Natural and especially Organic products. Times are changing with many key retailers now starting to embrace Organic and Natural Foods.If their retail customers want these products its important that the large CPG companies offer them as part of their product portfolio.

Analysis: Organic foods and Natural foods have now gone mainstream and as such we can find product offerings in almost every food category.Whole Foods sucess has caused many upscale chains to embrace Natural and Organic foods to their customers. Target, Super Valu , Kroger and many others all offer Natural and Organic alternatives. If its gone mainstream then how come Walmarts initiative in Natural & Organic was unsuccesful ? Simply put ,lower income shoppers have not embraced Organic & Natural foods because of their higher cost.However, more upscale retailers like Target, Byerly's/Lunds,Publix, Whole Foods and many others have all done well with these items and they will continue to grow.