Today is Blog Action Day. Blog publishers from throughout the world have committed to write something about the environment today in their blogs, offering there own unique perspectives depending on what industries, topics, issues or other things their publications focus on. You can read the organizer's full press release here.
As our readers know, Natural~Specialty Foods Memo (NSFM) writes about environmental or green issues as they relate to the food and grocery industries, on a regular basis. The topic is part of everything we write about--food marketing, retailing, food processing, agriculture and a myriad of related industries, topics, issues and ideas. We also have a weekly feature, Weekly Green Report, where we discuss all aspects of the environment as it relates to the natural and specialty foods and related industries.
As a participant in Blog Action Day NSFM has decided to bring you some interesting information and ideas regarding all things green this morning. Our goal is to stimulate our readers' thoughts regarding the environment and the natural and specialty foods industries. We also invite you to read our latest "Weekly Green Report" (published Friday, October 13) here. Over 15,000 blogs have signed up for Blog Action Day, and it's estimated their combined writings will reach about 12.5 million readers. We welcome our regular readers and readers viewing NSFM for the first time to Blog Action Day.
Report: Wal-Mart and Environmental Sustainability
In Friday's Weekly Green Report NSFM provided a report with various points of view from Wal-Mart's Living Well Sustainability Summit held in Roger's Arkansas on Wednesday, October 11. Read our report here.
These executives included: Andy Ruben, vice president of strategy and sustainability, Linda Dillman, executive vice president of risk management, benefits and sustainability, Leslie Dach, executive vice president of corporate affairs and governmental relations, and Doug McMillan, CEO of Sam's Club. Grover's interview is published in today's Treehugger Blog. You can read Sami Grover's exclusive interview with Wal-Mart's sustainability brain trust here. (We thank the folks at Groovy Green Blog for the Wal-Mart graphic at left.)
In addition to reading the piece linked above, you can listen to an 18 minute podcast interview with Andy Ruben, Wal-Mart's sustainability chief, and Ashok Gupta of the Natural Resource Defense Council (NRDC). In the interview, conducted by Betsy Rosenberg of the EcoTalk sustainability radio network, Ruben and Gupta lay out Wal-Mart's sustainability program and discuss how the mega-retailer and the non-profit environmental group are working together on some green issues and the Wal-Mart sustainability initiative. Listen here.
Speaking of EcoTalk, we suggest the following podcast interviews below conducted by Ms. Rosenburg. Like the Wal-Mart/NRDC interview above, all of the podcasts are free and you can download them here. Suggested podcast interviews:
>Interview Title: "Greener Pastures." Kate Clancy, author of the paper, "Greener Pastures: How Grass Fed Beef and Milk Contribute to Healthy Eating." She is the Senior Scientist with the Food and Environment Program at the Union of Concerned Scientists.
>Interview Title: "Daniel Imhoff: Paper or Plastic." Mr. Imhoff is the author of the book, "Paper or Plastic: Searching for solutions to an over packaged world."
>Interview Title: "Al Gore." Former U.S. Vice President Al Gore just won the Nobel Peace Prize for his work on reducing global warming. He is interviewed by Ms. Rosenberg about his book "An Inconvenient Truth" and the issue of global warming.
>Interview Title: "Frog's Leap Winery." Jonah Beer of California's Frog's Leap Winery is interviewed. The Winery and company vineyards are considered to be among the most environmentally sustainable in the U.S.
There are a number of other podcasts available at this link in addition to those we have suggested our readers listen to. Enjoy!
Analysis & Opinion: The State of the Organic Foods Industry 2007
We believe 2007 will mark the beginning of the "mainstreaming" of organic foods in the developed world. By this we don't mean organics will replace conventionally-produced food products as the norm anytime soon. Rather, by the "mainstreaming" of the organic foods industry we mean 2007 marks the realization among all sectors in the food and grocery industry that organic food products no longer are a tiny niche product limited to merely the elite, but rather the category is one that can have widespread appeal if factors such as the price/value ratio are reasonable.
We see five major develoments which have made 2006-2007 the "moment" in our opinion when the food industry (and consumers) have began to really look at organics as a viable, potentially mainstream food and product category. Those five "moments" are:
>The announcement late last year, and focus this year, by Wal-Mart that the world's largest food retailer would begin making a major push in the organic products category, merchandising many more skus of organic food and grocery products in their stores and making organic marketing a corporate retailing priority.
>An Announcement by the CEO of Kroger Co., the largest supermarket chain in the U.S., soon after the Wal-Mart organics initiative kick off that he wants Kroger to be the food retailer which brings organic foods to the masses. Kroger has dramatically expanded the number of branded organic food and grocery products it sells in its stores and developed an extensive private label organic grocery product line (which they continue to grow) since the announcement.
>The fabulous success of Whole Foods Market, Inc. and its acquisition last month of natural foods supernatural retailer Wild Oats Markets. Just 10 years ago Whole Foods was a retail super-niche grocer. The chain had stores in just a few regions of the U.S., primarily in major cities. Even in those places where there was a Whole Foods store 10 years ago only a select group of consumers shopped in the stores. Today, ten years later, Whole Foods has more than doubled the number of stores they had a decade ago, including markets in places like Tennessee, Kentucky, Illinois and other heartland and southern states as well as on the east and west coasts in the U.S. They also have stores in Canada and one in the UK.
Whole Foods also is growing as fast as it can. The grocer is going through a new store building frenzy, constructing and opening huge new lifestyle retail stores where organic products take center stage in every department, from produce, meat and seafood, to grocery, bakery, health & beauty care and non-foods. These stores have become more than a place to buy groceries for consumers from various walks of life--they've become "third places" where people love to spend time in the in-store restaurants, wine bars and even mini day spa's like the new addition to the recently opened store in Canpbell, California.
>The development by major grocery and mass merchandising retail chains like Wal-Mart, Target, Kroger, Safeway Stores, Publix, Wegmans and others in the U.S., and Carrefour (France), Tesco and Sainsbury (OK-based) and others throughout the world, of comprehensive private label organic grocery product brands which not only rival branded organic products, but conventional ones as well.
>The growing number of large, conventional consumer packaged goods companies that are either creating new organic grocery product brands or acquiring existing, smaller organic foods companies, or doing both. General Mills, Kraft Foods, Heinz, Kellogg, M&M Mars, Kimberly-Clark, Unilever, Nestle and many others are moving aggressively into the organic grocery and non-foods categories. Organic industry pioneering companies like Hain-Celestial are creating mega-consumer products companies built on organic product brands.
We believe these five key developments in 2006-2007 (plus a few others) mark a key moment in time--2007-- when all sectors of the food and grocery industry realized the organic category is not only here to stay but also becoming part of the mainstream.
Below is a chart prepared by Dr. Philip H. Howard, an assistant professor in the Department of Community, Agriculture, Recreation and Resource Studies at the University of Missouri. The chart shows the acquisitions of organic food and product companies made by the top 25 food processors in North America over the last decade. (The chart was prepared in July, 2007.)
The chart graphically shows the "mainstreaming" process of the organic industry via acquisitions by major consumer packaged goods companies over the last 10 years. We believe these types of acquisitions will increase dramatically over the next decade as the organic category grows in consumer demand and is merchandised even more extensively by major food retailers. Dr. Howard also has created a number of other charts detailing the current structure of the organic foods industry in the manufacturing, marketing and retailing segments. You can view those charts here.
Essay: 2007 A Green Tipping Point for Food Retailers
Just as we believe 2007 is a watershed year for the beginning of the "mainstreaming" of organic foods and products, we also believe this year is a major tipping point for the food retailing industry in most of the developed world in terms of environmental or green retailing.
Just a few years ago very few if any major food retailers (just like corporations in general and most people) took seriously such concepts as global warming, energy conservation, environmental sustainability and related green issues. In our opinion, today there is widespread acceptance in the retail food industry that all these environmental issues are real and that the time is here to address them aggressively. This year will be noted we believe as the year of the green tipping point environmentally for food retailers.North America and Europe's (also Australia and parts of Asia) leading food retail chains (and many independents) are to one degree or another launching green initiatives. Some initiatives are more aggressive than others but the key point is the industry norm is now that companies must incorporate their carbon footprints and other green issues into their day-to-day business operations. Leading global retailers like Carrefour in France, Marks & Spencer, Sainsburry and Tesco in the UK, Wal-Mart, Kroger, Safeway Stores, Publix, Whole Foods and many others in the U.S., are all in the process of refining their environmental policies and carrying out initiatives that include everything from attempting to measure carbon footprints to installing solar energy panels on store rooftops, buying wind power, cutting down dramatically on packaging, and in a number of cases even building "eco-stores" to the strictest green standards.
In Scotland, UK-based Marks & Spencer just opened two "eco-stores" which use 40% less energy than conventional supermarkets. Tesco is developing a similar "eco-store" format in the UK. In the U.S. Whole Foods is building two new stores that meet the strictest green building standards thus far developed globally under the LEED system. In California, Safeway Stores just installed solar panels on a store and is in the process of installing them on 30 more. Wal-Mart has done the same with 22 stores in California and Hawaii as well as at distribution centers in both states. These green initiatives are just the tip of the iceberg in terms of what these and many other food retailers of all sizes are doing environmentally. Much more is on the way.
In our view the green tipping point has arrived. This year will go down as the "environmental moment" when food retailing changed its paradigm from a raw energy consumer to a green, conservation-minded corporate citizen. A "Green Grocer" if you will. This tipping point was achieved by the realization that green retailing impacts the bottom line. Conservation makes environmental sense, but even more important to these retailers, it makes economic sense. We have no problem with economics being the driving force.
As realists we know much more needs to be done. However, our point is that the tipping point has arrived, which means the discussion now is focused on how best be good green retailers rather than the old discussion about whether doing so even made sense. We're also optimists and believe--especially with prodding from consumers and groups--these food retailers want to do the right thing. That doesn't mean they will compromise profits. But it does mean they are open to listen, to improve, and to make the environment a central aspect of their corporate and merchandising operations.
The next decade will look different than we can imagine in terms of green food retailing. The green retailing moment has arrived and we believe those retailers who seize the environmental mantle also will be the ones who succeed and thrive.
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