With Natural Products Expo East and West setting records for attendance, exhibitors and new products, it’s hard to believe that not long ago our industry was made up of only a handful of small, innovative manufacturers and retailers. Once a niche market, natural products are now thriving and continue to gain distribution thanks to the commitment and collaboration of the growing number of companies dedicated to their success. Natural retailers are the cornerstone of the industry and large, full-format, natural supermarkets now number over a thousand with annual sales exceeding $11 billion, a 71 percent increase since 2007. Even more tremendous than their growth however, is their impact on the food industry at large.
From independents to co-ops to larger regional chains, natural retailers have a profound understanding that selling better-for-you products is not solely about providing higher nutritional quality. It’s about making true connections with their customers, helping them satisfy their needs, constantly delighting and surprising them, and expanding their focus beyond their own personal motivations for eating a healthy diet to our collective social responsibility for creating a sustainable food system.
Their commitment has created, shaped and inspired the health and wellness market that has now permeated across all retail channels and represents an estimated $91B annually.
The expansion of the natural products industry is reflected in the exceptional growth sustained within natural supermarkets. In contrast to the relatively flat level of sales increase that has become the new norm in their mainstream counterparts, natural supermarkets have experienced double digit growth for years, even through the period of economic slowdown. Total channel dollar growth rates within natural retailers were 11 times those of conventional outlets in the current 52 weeks (11 percent versus 1 percent).
Conventional retailers have taken notice and have begun expanding their health and wellness offerings, to which consumers have responded extremely favorably. Natural product sales have increased 10 percent within the mainstream market, and organic sales are even stronger with 13 percent growth in the current 52 weeks.
Even as natural products become more readily available in the marketplace by way of new distribution channels, sales per location in natural supermarkets still outpace that of conventional by 10:1. Consumers and brands recognize the passion and innovation that is unique to Natural retailers, and thus continue to not only sustain, but strengthen their relationships with them.
“Natural retailers’ personal passion, love of food and a true appreciation for a ‘back to basics’ approach is what helps them continue to hit the mark in making a healthful lifestyle attainable for its shoppers,” says Amy Jacobsen, SPINS vice president of business development. “At the same time, brands recognize natural supermarkets as the trend catalysts that are willing to drive new and innovative products. By being able to offer more of their products, as well as a shared mission, they have a platform to build brand equity and loyalty.”
“I predict a cataclysmic shift in our food supply toward natural, clean and healthy products,” says SPINS CEO Tony Olson. “SPINS’ mission is simple: support brands who adopt this ethos, connect consumers to these brands and increase consumer accessibility to natural products, while protecting natural retailers and being a catalyst toward their growth. Natural retailers are the lifeblood of the natural products industry.”
As the market expands, the natural retailers who are the lifeblood of the movement will continue to adhere to their core values, inspire change and serve as the platform for further development and elevated product standards that define our industry.