Roadmap of U.S. Organic Food Markets - An Industry OutlookFrost & SullivanSeptember 27, 2007 66 Pages - SKU: MC1577781 |
| Countries covered: United States Research Overview
Market Sectors
Consumers’ Changing Preferences for Healthy Food Present Several Growth Opportunities in the U.S. Organic Foods Market Today, consumers are increasingly leaning toward healthier food and since organic food is known to be free from pesticides, antibiotics, and harmful chemicals, they are gaining preference. Organic foods’ added advantages such as no genetic modification (GM) or allergens has helped organic food sales to outpace traditional food sales. Moreover, increased occurrence of diseases such as diabetes and obesity combined with a general perception that the adoption of a healthier lifestyle including organic products can reduce the development of diabetes, particularly in obese people, has further boosted the sales of organic products. "Demand for organic food is growing immensely in the United States and motivating the giants in the food industry to enter this lucrative market," remarks Sneha Pasricha, analyst of this study. "Several multinationals are vying for strong positioning in this market by either offering new organic food products or by strategically acquiring or partnering with flourishing major organic brands." Rising retailer interest in this niche market is also encouraging for the market’s future. For instance, Wal-Mart is trying to capitalize on the new organic trend by investing a lot more in private label new product development and offering a wide range of branded organic products to satisfy increasing consumer demands. Participants Must Achieve Greater Economies of Scale to Make Organic Products Available to the Masses The organic food and beverage market is rapidly strengthening its presence in the United States both in terms of mounting sales and more access to customers. However, these products are still not affordable to the masses of the United States due the premium charged on them. To make these foods available to all, companies will have to aim for economies of scale and scope. The market also has to deal with the inadequate amount of organic ingredients available to manufacture organic foods. "In this case, strategic alliances with ingredient suppliers and farmers can be instrumental in bringing stability in the ingredient supply," explains Pasricha. "Also, initiatives by food processors to establish their own farms can aid in addressing quality issues related to the organic ingredients." |
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