Organic Articles: Strengthening The Organic Infrastructure, October 2001

The Organic Consultancy

Strengthening The Organic Infrastructure

by Simon Wright

This article originally appeared in the October 2001 edition of Natural Products.

The backlash against the involvement of major companies in organics has started. The current edition of The Food Magazine reveals to a startled public that Enjoy Organics are owned by RHM and that Seeds of Change are owned by Mars ! To which could be added Unilever Bestfoods purchase of Go Organic and the presence of organic lines from Heinz, Arla, Muller and Nestle. Here I must declare an interest as the first part of my career was spent working for major food manufacturers like United Biscuits, Nestle and Unilever. My developing interest in organic food then took me to the Whole Earth / Green & Black’s group, after which I set up The Organic Consultancy to work with both multinationals and much smaller companies. So I’ve worked with big companies and I’ve worked with small companies and at the risk of setting Lady Eve and other organic pioneers spinning I suggest that the continued involvement and support of the major food companies is crucial to the success of organic food. Only major food players can deliver the increase in volume that will allow organic food production to deliver significant environmental benefits.

Consumer research shows how the marketing budgets wielded by major brands are attracting new consumers to the organic sector. However there are other benefits that come from the entry of major players above and beyond the size of their corporate chequebooks as can be seen by a review of three recent problems experienced by organics in the UK.

One example is product safety. Back in 1999 a start-up company called Organic Valley bought a canning factory and secured supermarket listings for its products. However a batch of organic soup was under-cooked and this mistake was not spotted until the cans had been delivered to a major UK supermarket, prompting a full product withdrawal. Consuming under-processed soup is potentially fatal due to the risk of botulism. The resulting tabloid headlines (“Killer Organic Soup !”) would have been disastrous for the entire organic food sector and we would all have suffered as a result. Major food manufacturers have stringent checks and balances, largely as a result of meeting the rigorous standards required to produce own-label products for the UK supermarkets. I have visited small organic producers who manufacture to the highest standards of product quality and safety, but it is much easier to do this with the resources of a major food processor.

Product quality is another area where larger manufacturers frequently have an advantage. All the consumer research I have seen suggests that many consumers expect organic food to taste better than non-organic. Until recently this was not the case with tomato ketchup. The majority of organic tomato ketchup was being processed using the static retorts or hot fill technology used by most small food manufacturers. The limitations of this system result in tomato ketchup that has a brownish colour and tastes overcooked. When Heinz entered the market they were able to utilise their up-to-date (and extremely expensive) technology to deliver an organic tomato ketchup which is less processed, resulting in improved colour and taste. The Heinz product meets consumer expectations of an organic product which is at least as tasty as the non-organic version. Products that consistently deliver on taste are crucial to the continued growth of the organic sector.

A third example is organic fraud. Currently there are at least three major frauds being investigated in France, involving namely Green Negoce, Bio Alliance and Eurograins. The EU organic regulations contain a loophole that makes organic fraud more likely in that traders do not have to be registered with a certifying body. Both the Soil Association and the German government are determined to close this gap. I would argue that larger companies are less likely to be affected by fraud as they have the resources to send their buyers out to foreign countries where organic crops originate. Frequently large companies have their own farms, or at least have direct contact with producers because of the volume of crops they purchase. It is smaller companies who tend to purchase ingredients via intermediaries, thus increasing the risk of fraud. Larger companies also tend to have more robust systems that ensure automatic product traceability and the resources to ensure that these systems are kept fully up to date.

The challenge for the organic sector today is for us to work with large food and drink suppliers as they take their first steps into the organic sector and encourage them to engage with their suppliers and consumers in a fair and ethical way. The continued involvement of the major supermarkets is crucial. The ongoing investment made by supermarkets such as Sainsbury’s, Waitrose and Tesco in the organic sector has been identified as a major factor behind the current strength of the organic market in the UK. The work done by supermarkets often benefits the entire sector. Examples include Marks & Spencers funding research on organic farms aimed at improving UK organic agriculture, Waitrose financing open days for organic growers and Sainsbury’s promoting IFOAM accreditation. Some supermarkets now understand about supporting UK organic farmers, and regional organic sourcing is next on their agenda.

I still see a continued role for smaller, more specialised organic companies. Companies with well-designed brands such as Free Natural, Lyme Regis Fine Foods and The Organic Spirits Company have a strong future developing innovative quality products that delight and enthuse organic consumers. It is frequently smaller companies who lead the way in new developments – Whole Earth’s adoption of “carbon-neutral” production policies for its organic breakfast cereals and The Village Bakeries use of organic yeast are two good examples. Similarly local shops, local producers, box schemes and Farmers Markets will all remain key players the organic food sector, helping forge direct links between organic consumer and producer. I hope we will see more David & Goliath-type partnerships such as the recently-announced joint distribution deal between Simply Organic and Express Diaries. The strength of such a partnership is that the larger partner learns about organics whilst the smaller partner gains access to new business skills and contacts.

The mainstream food industry loves to talk about partnerships but in the past the benefits from such partnerships have tended to be one-sided. Successful organic food production demands true partnerships between farmer, processor and retailer. My hope is that the large food companies who are now beginning to understand organic production will begin to implement key organic principles such as quality, integrity, respect and traceability across their businesses as an example of best practice. In this way organics can raise standards throughout the entire food industry, a result which we can all welcome.