Organics are a growth business for French food retailers

What we’ve seen

The market for organics is growing rapidly in France. It is no longer a niche sector. The leading grocers are developing their own branded organic lines and opening dedicated organics stores.

In March Carrefour opened its sixth Carrefour Bio store in Paris, with plans to open more by the year-end.

In June 2016 Leclerc opened a store specialising 50/50 in organics and Italian produce, "Leclerc Bio & Italien" in Nice, with 2,500 sq m of space, claiming to be the largest organic store in France.

In August Carrefour acquired Greenweez, the leading organic online shop in France, with growing interests in Europe (sales of €20 million in 2015)

In September Auchan opened its second Coeur de Nature store in central Paris. The store sells a range of 100% organic produce, organic cosmetics and food supplements, in-store bakery and juices, local and artisan fresh produce, as well as eco-friendly services and products

Organic is growing

The market for organics in France is growing. According to the Agence Bio, by the end of 2016 the consumer market will have grown 20% on the previous year to be worth € 6.9 billion. The specialists are growing fastest, but the supermarket/hypermarket operators are not far behind.

Mintel’s own research shows that many French consumers are changing their shopping habits, and that the numbers of people choosing to buy more organics and prepared to pay more for them is growing.

Figure 1: France: Grocery shopping habits, Q4 2015 and Q3 2016
[graphic: image 1]
Source: Lightspeed/Mintel

A lot of the appeal of organics lies in the "free from" aspect - not just free from pesticides but also free from things such as sugar, nuts, lactose, gluten etc. Mintel has highlighted in its trend research how many shoppers have a better understanding of what they should and shouldn’t consume, and are interested in knowing about a product’s ingredient list, provenance, manufacturing process, shipping and storing methods. Thereis also a growing desire to shop locally, buy local product and understand exactly where purchases come from. Many also offer packaging free groceries, with self-service sections where customers can buy as much or as little of items such as nuts, dried fruit, cereals and grains.

Retailers of organic products

Biocoop the leading specialist

Biocoop is the market leading retailer in organics in France. It is a fair trade, organic, local and environmentally responsible supermarket supplying quality produce and household items around France. In 2015 it opened 21 new stores and renovated 26, with a total of 383 stores at year-end. Store sales grew 17% to €768 million. Biocoop is increasing it presence in more regular retail locations and in May opened a store near the Champs Elysées and in June, its 400th store, in Paris.

Other specialist retailers in this field include La Vie Claire, Naturalia,La Vie Saine and L'Eau vive.

Grocers cashing in with own-labels

Not wanting to miss an opportunity, the hypermarkets and supermarkets have also developed their own organic ranges. Carrefour and Leclerc are two of the most popular, but Auchan and Intermarché also have organic ranges.

Both Lidl and Intermarche have changed the branding of their organics, from a separate own-label (Regain at Intermarche and Biotrend at Lidl) in favour of organic versions of their existing brands, embedding the organic ranges into their mainstream offer. Lidl launched a premium organic line in September called Si bon si Bio.

And developing stand-alone organic subsidiaries

We have seen Carrefour, Leclerc and Auchan open stand-alone stores selling only organics recently. Such stores enable the grocers to raise the profile of the organic ranges in their other stores and Drive click and collect services.

With the acquisition of Greenweez, Carrefour is expanding its interests not only in organics, but also in e-commerce, an area where it is looking to grow.

Where next?

Organics are still a niche market. At under €7bn they account for just 5% of food spending (3.5% of food and drink). But they are growing as a significant number of people feel that it is worth paying up for products they can trust as well.

French consumers are increasingly "flexitarian" and want to mix and match vegetarian/meat and organic/free-range/non-organic, so retailers need to cater to this trend. There is scope for the big retailers to increase and improve their organics and free-from ranges and expand their specialist store chains as well. All of these would help drive further growth in the market.

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