Sainsburys and Tesco battle over organic vegetables

Tue, 01 Aug 2006
 
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A new battle is about to start between Sainsburys and Tesco when they both launch rival organic vegetable box schemes.

Up for grabs is the organic food market which is worth £1.6bn and is steadily growing at 30 per cent a year.

Sainsbury’s are due to start their trial at the end of August in East Midlands and East Anglia to 500,000 customers, whereas Tesco will concentrate on London in early September.

Currently local farmers offer seasonal produce, as a result big supermarket chains are pledging to source more locally grown produce to reduce the popularity of farmers’ markets.

This development comes at a time when the Competition Commission is looking into the £100bn-a-year grocery industry amid fears of the supermarkets having too much control of the market.

Sainsbury’s organic boxes are looking to support local producers but they would go nationwide if it was necessary. Tesco will source vegetables from East Anglia initially but environmental campaigners feel that by the supermarkets entering the box scheme, existing box businesses could be pushed out.

Sandra Bell, real food campaigner at Friends of the Earth, said: "It will be a threat to the smaller, very genuinely local businesses that are running successful box schemes because Sainsbury's and Tesco will be able to undercut them, which could put local farmers out of business."

The Sainsbury’s box will contain eight seasonal salad items which will be packed and distributed from a base in Cambridgeshire at a cost of under £15. They say this will be a convenient way to shop as they can be ordered alongside their weekly shop . In the future if the economics are right and the demand is there the scheme could extend to fresh meat and poultry.

Karen Schenstrom, Sainsbury's trading director for fresh produce, said, "This is an obvious extension to our offer, not about trying to put Abel and Cole out of business . Our customers like organic food and want someone to help them select the best seasonal products."

Tesco’s box will contain a mixture of vegetables, salad and fruit and will be supplied on a fortnightly basis.

A spokeswoman said, "We think there is a lot of demand from customers for this type of product." If the scheme is a success Tesco will open the scheme out nationally. The trial will be based at the Croydon store.

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