Wal*Mart expands into natural and organic foods

It’s a truism that smaller companies quake in their virtual boots when one of the market leaders decide to pay attention to their niche, but even with the overall increase in so-called natural food sales, it’s darn interesting to see that the original 800 pound gorilla of retail, Wal*Mart, has announced an aggressive move into organics.

According to an interesting story from the Associated Press:

“Putting new items on the shelf this year, from organic cotton baby clothes to ocean fish caught in ways that don’t harm the environment, is part of a broader green policy launched last year to meet consumer demand, cut costs for things like energy and packaging and burnish a battered reputation.”

We occasionally find ourselves in the local super Walmart here in Colorado (frankly it’s kind of like touring a Chinese manufacturing exhibit, if y’know what I mean) and I have noticed that the company is slowly moving more and more organics into its produce area, just as Safeway is also trying to retain some of the customers who would otherwise go to Whole Foods or Wild Oats or a smaller natural foods store.

walmart organic produce department

Indeed, it’s my opinion that Whole Foods is moving as fast as it can towards the general non-organic inventory of a Safeway just as fast as our local Safeway is pushing into organics and natural food. Someday they’ll meet and we’ll have even more confusion in the marketplace about where to go for what…

But the most interesting point that this AP article makes isn’t about Wal*Mart’s decision to add more organic and natural inventory to its stock, but the impact that their buying power can have on the environment and agriculture:

“Wal-Mart Stores Inc. is throwing its weight behind organic products, a move that experts say could have the same lasting effect on environmental practices that Wal-Mart has had on prices by forcing suppliers and competitors to keep up.”

It’s all about scale and scope:

“What makes Wal-Mart’s efforts unique, sustainability experts say, is the retailer’s sheer size and the power that gives it in relations with suppliers. Wal-Mart works closely with suppliers to shape their goods, if they want them on the shelves of Wal-Mart’s nearly 4,000 U.S. stores and over 2,200 internationally.”

So, in an odd sort of way, I am glad to hear that Wal*Mart is trying to make some changes to lure in more affluent buyers, even if it poses a very real risk to the rest of the natural and organic retailers like Boulder-based Wild Oats Markets.

I also worry a bit that this can actually backfire, to be honest, and further dilute the “organic laws” that detail whether or not food can be genetically altered, etc., and still be labeled organic, but I’ve been watching those laws dilute as more corporate agribusiness get into this segment anyway.

So tell me, what do you think?

I know it’s rather trendy to be anti-Wal*Mart and to be appalled by the great strength of the company and at what I believe are the inevitable results of our commoditized, foreign-made merchandise future, but if there was a gentler, more environmentally friendly Wal*Mart, would you be willing to give them some of your business next time you go grocery shopping? What about the vast swath of people who don’t have access to a natural foods store and might find this their first exposure to non-processed foods? Could this be a good way for more natural foods to be accessible by a larger populace?

11 comments on “Wal*Mart expands into natural and organic foods

  1. I think it will be a great thing if the foods are truely organic. I worry, like you said, that the laws will become weaker and weaker and before you know it our organic foods will be just as bad as the mainstream.

  2. If they don’t trample the definition of “organic”, and can be a force to change the way foods and other products are developed that’s great. However, I still can’t bring myself into entering the local Wal•Mart. Not for trendy, or even global/local consciousness reasons. I just find Wal•Mart really, really icky, and can’t stand the experience. Pricing just isn’t enough to abuse myself that way

  3. This is really great news. Wal*Mart might just be the final factor that could drive organic foods costs to a price competitive with traditional food. Increased exposure = increased interest = increased demand. Supply might be limited now, but the way Wal*Mart operates will likely keep prices down. Producers might move from traditional to organic just to supply Wal*Mart. A big reason some healthier food is more expensive is lack of interest. Fewer customers means that the producers have to charge more to cover costs. It’s a lot like electronics. The brand spankin’ new super-duper double looper new TVs cost bookoo bucks, but 3 years down the line the market’s interest changes. More people purchase the products so the producers can afford to set more reasonable prices. And the product becomes market driven. Organic food really isn’t market driven yet. (IE supply vs. demand) The prices are set by what people are willing to pay, and the more affluent who frequent health food supermarkets can afford higher prices. This move will hopefully bring healthier living to the masses. And the competition will likely drive costs down at my local Whole Foods.

  4. I’d like to think Wal*Mart could have a positive influence in the world, but I’m afraid it’s just not “the nature of the beast.” It may not make it worse, though.

  5. I read this same article. I have mixed feelings on it. I do agree that Wal-Mart has tremendous buying power and influence in the overal marketplace. With more and more of these “super” wal-marts going in, the number of people actually purchasing their groceries from them is on the rise. In that instance, I’m glad to see Wal-Mart offer organics to their clients – hopefully this will make organic foods more affordable to people who under normal circumstances would not have purchased them. However, I also worry about the organic standards in the industry. Because Wal-Mart is such a super-power, I would hate to see them influence lower standards of quality for organic products. I personally hate Wal-Mart. I used to be a frequent shopper, but found my local store to get increasingly dirty and with terribly customer service. I have found alternatives – even if they aren’t as cheap. It will be interesting to see how things unfold in this case.

  6. Walmart latching on to organics is down right scary. For businesses to get/stay in Walmart stores they have to lower their prices which often equals lowering the quality of their product. I don’t want thinner cardboard for my milk containers or a cheap plastic to hold my juice. I shutter to think what choices the organic farmer is going to have to make to stay competative. I already noticed one brand of organics coming from off shore. I have a hard time with buying organic green beans from another country. It seems like it defeats the purpose. I am sick about it.

  7. Theresa,
    Since there will always be a market for high end products, there will always be high end products. Hopefully Whole foods and the other “classic” organic shops will continue to maintain their desire for high QUALITY organic foods. A large part of the draw of Whole Foods (for us older loyal customers*) is the personal integrity of the store. It’s AS important or even MORE important than the organic natural food itself. So I am hopeful that Whole Foods understands that the core of their customer base cares about quality and therefore they will maintain their integrity.
    *The growing customer base is getting jerkier and jerkier so they care less and less about quality and integrity.

  8. Theresa, I agree about not wanting to purchase off-shore organics–that does seem to defeat the purpose. I’d rather buy conventional vegetables from my local farmer’s market than organics trucked in from Mexico or Chile. The burden of transport needs to be figured in when making buying decisions. The only thing I consistently buy organic is strawberries, but even then I try to get organic strawberries from Florida, not from California (on the other side of the country from Virginia…).
    Dave, to your question–putting hatred of Wal-Mart aside, I *might* venture in to buy organic veggies/fruits/cotton clothes. My concerns would be maintaining organic standards re: pesticides, herbicides, GMOs, as well as the labor conditions for the people picking/selling said wares.
    It does seem that Wal-Mart is trying–I heard on Marketplace yesterday that they are going to start offering part-time employees health care benefits after only one year of employment, not the two years they currently have to wait. This, coupled with the move toards organics, could be a turning point for Wal-Mart, but I’m not ready to let my guard down about this company just yet…

  9. This is like my sister who justifies her use of disposable diapers by saying that they go through the local composting system. Too bad she never read the details and found out that the vast majority of a diaper is plactic and can’t be recycled/biodegraded in any way. Wal-Mart organics are just a scary way of making people feel good about themselves without having to really know what they are doing.
    Clearly I have a larger beef with Wal-Mart but it does seem like too much of their ‘buying power’ is used to bully producers into bending to their will and so I share all your fears about a watering down of the organic standards and the damage that will cause those of us really trying to make a comitment to the organic movement for greater reasons.

  10. I agree with the moms that feel organic is going to be taken advantage of in the USA for corporate benefits. I personally shop local and support local farmers but not everyone has that benefit in their area – I just hope families can learn that our FDA has broadened the meaning of organic and organic can end up meaning nothing. It is best to stick with companies who believe in high organic standards.
    I think we should stick with the smaller and often higher priced stores but if you buy less- you waste less. WalMart is still betting on consumers to buy more than they need.
    For food go with Wild Oats
    For clothes go with Underthenile.com
    and for toys go with toymobile.com
    Then you know you are helping companies that help the environment and not their pockets like walmart.

  11. I have to say it. I am POOR. I am a stay at home mom, so we are a one income family. We use food stamps. If you can tell me what Whole Foods market takes food stamps, I would love to get my food from there, until then viva Wal Mart!!

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