The membership-based grocery chain has been leading the surge in big box going all-natural.
Organic produce and $1.50 hot dogs: That’s what Costco does.
Still, Costco didn’t conquer the organic market accidentally. Expanding its offerings has been part of a calculated effort to capture younger consumers and lure them away from other retailers. The membership-based chain has increased its organic sales by about $1 billion in just six months, and it plans to push even harder.
So, Why Should You Care? That big-box retailers are adding more organic options signifies that American food demands are changing. Not only are organic foodshealthier for your body—they tend to have more antioxidants and lack the pesticide residue of traditionally produced food—but they’re also healthier for the environment. According to the U.S. Department of Agriculture, “The principal guidelines for organic production are to use materials and practices that enhance the ecological balance of natural systems.”
The market for organics increased 12 percent from 2013 to 2014 and is projected to jump double digits again going into 2015. The increase in demand has directly led to an increase in supply.
“While the challenges in terms of supply are still out there, they’re becoming less formidable because there are more organic suppliers and producers,” Richard Galanti, Costco’s vice president and CFO, said in a conference call with the analysts. “We’re working with them to commit more to it.”
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