Discount supermarkets conquer the organic food business

Status: 07/16/2023 08:41 a.m

More and more cheap organic food can be found on the shelves of supermarkets – the discounters are also outdoing each other with offers. Are organic pioneers the losers of this boom?

Aldi Süd has just gone on the offensive again: “Only only nature, that’s organic, which goes further, for conscious nutrition,” says the commercial for the discount supermarket chain’s new brand. A spokeswoman explains what “goes further” means in concrete terms: “The unique selling point of the brand is based on ingredients that are as original as possible, such as spelled, sea and rock salt instead of table or industrial salt and gentle processing.” Sentences that used to only be heard in health food stores, but not from the industry giants.

“The quality will suffer”

The organic shop “Quer Beet” has been in Kassel since 1987. Owner Mira Sulzbacher feels every day what it means when there are more and more cheap organic products at discounters. “Of course, our organic shop is a bit more expensive than the organic at Lidl or Aldi, so customers are already leaving. We have noticed in particular that less fruit and vegetables are being bought, which was actually always our strongest pillar. But it’s also less overall become.”

The 33-year-old grew up in the shop her father founded. 36 years ago, Martin Sulzbacher was one of the first in northern Hesse to go organic. He was often laughed at for his idealism. He is skeptical about the development towards more and more organic from discounters: “If everyone makes organic, then it will no longer be the same. Bioland will make cuts, Demeter probably too. So I’m afraid the quality will suffer as a result.”

It matters to the customers

There were similar fears when Lidl and Bioland announced their cooperation in 2018. Nothing has happened – except that customers can now buy organic products cheaper. And the numbers show that it works. Sales of organic food in Germany more than doubled from €7 billion in 2012 to €15 billion in 2022.

According to market researcher GfK, however, sales in organic supermarkets fell by 10.8 percent last year. The health food stores even recorded a minus of 37.5 percent. The situation is completely different with the retail chains’ own brands: they have increased by nine percent.

Organic as the “new normal”?

Aldi Süd is relying on this effect with the new brand. They receive support from the organic association Naturland, whose logo can be found on some of the products. “We have the climate catastrophe, we have the dramatic loss of biodiversity, we have animal husbandry that is completely unacceptable in parts, and organic is just part of the solution to these problems. That’s why organic as the ‘new normal’ is imperative,” says Naturland Managing Director Steffen Reese.

For him, there is no alternative to working with the discounters in order to reach mass customers. So are Naturland and Co. partly responsible for the decline of the small shops? “I don’t think at this point that success eats the pioneers,” says Reese. “We have different target groups in the discount and organic food trade, and I believe that if we succeed in attracting more organic customers through the discount, then those looking for other products will also go to the organic shops.”

Where is all this organic supposed to come from?

Norbert Klapp has been a pig farmer for 30 years. His breeding stables have type 2 husbandry, which means “stall plus”. This is slightly above the legal minimum standards: each breeding sow has 0.8 square meters of space. Around 95 percent of the breeding stables in Germany have this form of husbandry.

A conversion to organic farming would be expensive: “I’m at almost a million euros that I would have to invest,” says Klapp. “Of course I’m also thinking about it. The problem at the moment is security, long-term contracts, for example, so that I don’t get stuck on my investments.” The Landzwei advises not only to look at the organic seal, but to buy regionally manufactured products.

Organic is not the same as organic

Mira Sulzbacher from the organic shop “Quer Beet” also says that her organic from the region is very different from the discounter organic: “The main aspect for me is actually regional and seasonal. We have many suppliers here directly from Kassel or the surrounding area. These are very small companies, which means that we simply have a much larger range of direct suppliers.”

She too thinks it’s good for everyone that more and more food is being produced according to the high organic standards. She wants to persevere and hopes that organic really will become the “new normal” – and that her organic shop will also benefit from it.

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