Organic Articles: Transfat, June 2006

The Organic Consultancy

An Interview with Alison Austin, Head of Brand Policy and Sustainability, Sainsburys Supermarkets

Simon Wright, O&F Consulting

What do you do at Sainsburys ?

I head up a small team of experts who develop policy on issues such as animal welfare, farm assurance schemes, animal testing, genetic modification, sustainable product sourcing, ethical trading, Fairtrade, organics, health and nutrition, special diets, energy, waste, packaging and recycling.

Which of those do you find the most personally motivating ?

Definitely organics and Fairtrade, and then health and nutrition we feed over 16 million customers a week ! I handle organics personally and am really glad to do so, and I have been personally motivated by Fairtrade ever since I went to the Windward Islands and saw the reality of Fairtrade.

What are you doing on sustainable fish sourcing ?

What we have decided to do is to make sure we have fish for today and fish for tomorrow. Behind that simple statement is an enormous amount of work. We have developed an assessment system with the support of the Marine Conservation Society and we have a programme to put all the fish we sell through this assessment system. The first species we looked at were skate and huss, and they were so obviously unsustainable that we decided to stop selling them even though this represents 650,000 in sales per year. We trained our fish-counter colleagues to advise customers as to what other fish they could buy. We are promoting less well-known sustainable but seasonal species such as Torbay Sole and Red Mullet via our New in Season offer

A recent campaign by Friends of the Earth has drawn consumers attention to the unsustainable nature of much palm oil production. What are Sainsburys doing to address these concerns ?

We are committed to joining the Roundtable on Sustainable Palm Oil, developed and run by the World Wildlife Fund. We will be meeting lead suppliers in the major categories where palm oil is used biscuits, cakes, margarines, health and beauty, household cleaners to get a better understanding of where they source their palm oil from and how they use it. Our objective is to use certified sustainable palm oil wherever this is commercially feasible, probably early 2008.

The trade press recently picked up OMSCos disquiet about Sainsburys milk in conversion scheme. Whats going on?

We have seen market growth of organic liquid milk at Sainsburys of 80% year-on-year – as opposed to market growth of 60% – probably because it is such a good entry point into organics. So we knew we were going to exceed current supplies of organic milk but we wanted to avoid having to import organic milk as our some of competitors do. We have a clear and committed UK sourcing policy. We were concerned that there seemed to be a low level of interest from non-organic dairy farmers in converting to organic production and we needed to be pro-active to remove the concerns that farmers have in going organic. So we put together a scheme with our supplier Dairy Crest where for the period of conversion until the farm receives its organic certification, we will cover all the farmers oncosts. We also offer a guarantee that for a year from their certification date, we will buy the farmers organic milk. We have two farmers about to enter the scheme which will give us some of the extra capacity we will need in 2008. We talked to Defra and the certifying body on how to present this scheme to consumers. During conversion the milk will be clearly sold as non-organic, stating that a donation from the price goes direct to the farmer to cover all his cost of converting.

Currently supermarkets are losing market share to other channels such as box schemes. We have Wholefoods opening in London early next year. How do Sainsburys respond to these challenges?

The growth of box schemes is interesting in two ways. Firstly it is helping to drive the overall organic market and that has got to be good news. Secondly it is encouraging people to be more curious about the food they are buying. Box schemes are good at provenance, and this is something that all players in the organic sector have got to consider – deliver the story behind the product. With Wholefoods it will be interesting to see how much of what they stock is organic and how much is natural. But no-one in the UK organic market at present can afford to sit on their laurels.

For Fairtrade Fortnight this year Sainsburys converted 75% of all the roses they sell to Fairtrade. Why?

We wanted something that could really make an impact on a big scale, so we chose our 4.99 roses, where the sales are huge. We launched in January, so it would be smooth-running by the time of Fairtrade Fortnight. We promoted using Point Of Sale to say same price, same quality but Fairtrade This catapulted us into number one Fairtrade retailer with 34% market share and its going great guns and making a huge difference to the growers.

How do you react to Marks & Spencer taking a whole category like hot beverages and turning that Fairtrade?

I think it is good to see major retailers making a commitment to sizeable market changes towards Fairtrade because that makes an impact with customers. However the Co-op moved all their own-label chocolate to Fairtrade a while ago, we moved the vast majority of our roses to Fairtrade so it is unsurprising to see another retailer make a move like this.

Whats next ?

The growth of our sales in organics is really good – latest data from TNS shows that we have reclaimed the number one organic spot from Tesco with our own-brand range. We need to encourage more UK growers to convert, as we are doing with milk. It will be interesting to see how the organic and Fairtrade markets respond to the need for healthier products. Certainly some Fairtrade products such as chocolate and alcohol are indulgent and its a question of whether for example we can expand Fairtrade fruit.

Simon Wright
23.03.06

This article originally appeared in Organic and Natural Business Magazine for June / July 2006