Walmart plans to offer organic foods for less

A Walmart in Panorama City, Calif. The discount giant will be selling Wild Oats organic- food products at competitive prices. Over the next year, all stores will sell them.
A Walmart in Panorama City, Calif. The discount giant will be selling Wild Oats organic- food products at competitive prices. Over the next year, all stores will sell them. (Bloomberg)
Posted: April 11, 2014

 Walmart, the nation's largest grocer, is partnering with health-food provider Wild Oats to offer a line of reduced-price organic-food products at its stores nationwide.

By offering organic products at prices comparable to nonorganic national brands, Walmart can be expected to put considerable price pressure on organic products across the board.

"We don't think consumers should have to pay high prices to put food on their families' tables," said Jack Sinclair, executive vice president of Walmart's grocery division. "And organic products are no exception."

The move was prompted by internal research that showed that 91 percent of Walmart shoppers were interested in organic products if they were priced competitively with nonorganic brands, Sinclair said.

Organic foods - produced without chemical fertilizers, insecticides, animal antibiotics, or hormones - can be more expensive and come with a premium price for consumers.

Sinclair estimated that the premium was a minimum of 25 percent for products sold at Walmart. That premium, he said, would be eliminated on the store's Wild Oats products.

For instance, Walmart currently sells a 6-ounce can of organic tomato paste for 98 cents, Sinclair said. The comparable Wild Oats product will sell for 58 cents.

Walmart will be offering about 100 Wild Oats "pantry" products such as canned vegetables, spices, and chicken broth. There are no plans at the moment to sell fresh produce, such as eggs and organic milk.

"We are going to start with the pantry items," Sinclair said, "and see what happens beyond that."

Initially, the new products will be available in about 2,000 of the chain's 4,000 stores, he said. Two in Philadelphia - one on Columbus Boulevard and the other on Wheatsheaf Lane - will be among the 2,000. Over the coming year, as the supply chain is secured, the Wild Oats brand will be available in all stores, Sinclair said.

He credited Walmart's size - it serves 140 million grocery shoppers a week - as giving the company the ability to leverage better prices for organic foods.

Its commitment to selling organic foods will allow for lower prices long-term, Sinclair said, by guaranteeing demand for producers years out.

"We have had a number of producers say to us, 'If we know what you want five years from now, we can make some very significant investment in land, in seed.' "


chepp@phillynews.com

215-854-2594

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