Structure of the Organic Food Industry Intensified consumer demand for organic food products has resulted in increased competition in the manufacturing and retail space. Changing consumer preferences and stiff competition buoyed by the challenging organic growth environment has led to many food stores to consider reevaluation of their brand portfolios and stores while considering strategic options that can enhance their growth opportunities and optimize their capital allocation. The result has been waves of consolidation witnessed in the recent past, such that recently, Roundy's was acquired by Kroger in a bid to enhance the company's presence in the Mid-Atlantic and Carolinas markets (Duff & Phelps 3). The competition has been intense such …show more content…
Organic brands in different categories including tea, preservatives, oils, and vinegar, together with health and beauty segments are realizing the value of organic content and constantly innovating and developing new products, and have recorded remarkable growth. Streamlining organic range products among different retailers is a response to the competition, with UK's Ocado increasing their product range by 26% in 2015 (Soil Association 9). Duchy is the newly redesigned brand by Waitrose, while many other retail chains are rationalizing their operations by emulating such facilities as discounters. Online shopping is gaining momentum, and many retailers are increasingly utilizing online stores (company websites and other stores as Amazon) for people to order their products and have them delivered at their convenience. Value addition is growing, and organic catering is experiencing buoyant growth across restaurants, leading to the emergence of a new industry within the sector that uses organic products. Organic menus are featuring in the high-end street and fast food restaurant chains, such that in 2015, McDonald’s utilized more than 25 million of semi-skimmed organic milk in its porridge, coffees, and