Germany still leads the pack
Posted - January 30, 2010
Germany still leads the pack
Based on a report produced by Dr. Klaus-Juergen Holstein, Ein Herz fuer BIO magazine
Germany still represents the biggest organic market in Europe, with potential for growth, followed by France and Great Britain. Organic sales account for 6.5% of the total food sales in Germany, 3.4% in France and 2.2% in Great Britain.
Compared to the other two countries, the German food market is generally low-priced, including organic food. The German organic sales concentrate mainly on fruit and vegetables, supplements and wellness food from rice cakes to vegetarian spread, and on dairy products.
Regarding channels of distribution, at the end of the 1990s small specialist shops dominated with over 40% of organic sales. Today, the 2000 specialist shops account for only 23% of total sales. Supermarket chains with around 40,000 outlets account for 35 %, and 19% of sales go through discount-markets, which with 10,000 retail shops account to 40% of total food sales.
Specialist shops do not have a well developed structure yet.There are only two large chains , Alnatura and Denn´s. The leading organic seller is tegut. Wth only 300 shops, nearly 20% of the retailer’s annual turnover is organic food.
Sales of organics are reported higher in smaller outlets, with a 9.4% increase compared to 1% for the general food sales growth. Many small-sized German supermarkets are manager-owned within the food chains Edeka and Rewe. At Edeka some regional offices in the South of Germany buy organic food directly from regional wholesalers or producers. At Rewe management has a more national centralized purchasing operation.
Germany’s best known organic brands started as a combination of an organic umbrella or brand and wholesale operations such as Biozentrale with Gut & Gerne, Rila with Rinatura and Rapunzel/Biogourmet. The smaller supermarkets normally sell a range of about 12,000 products, 400 – 1200 of which are organic quality, while the larger retailers offer a selection of 20,000 to 30,000 products, with up to 3000 in organic quality. Maximum stock capacity per outlet is about 14,000 products, which means many products have to be delivered directly to the shops. Over 60% of organic products are distributed by wholesalers.
The main consumers of organic food in Germany are baby boomers 50+. The younger generation find organics too expensive and not attractive enough, while the 30 + generation, more into the “feeling good”, trend, is turning into the most avid advocate of organics. Buying local continues to be a strong motivator in general and health concerns are the main reason for buying organic.
During the current financial global crisis the German organic market has remained strong and stable, except in the consumption of dairy products. While there is high price pressure on all vegetables, products such as coffee, wine and preserves reported sales increase. The trend of organic products, offering good value, continues.
