SECAUCUS, N.J. -- If pricing on natural or organic items is more than 30% to 40% above the mainstream equivalent product, that's too much, according to Irwin Simon, chairman, president and chief executive officer of Hain Celestial Group, Uniondale, N.Y., which produces a range of natural and organic food brands.
It doesn't cost that much more to make an organic baby food, Simon told a breakfast meeting devoted to the topic of merging the kosher, organic and specialty categories during the 13th annual Kosherfest 2001 trade show here last week.
"People are not stupid. They are not going to pay 30% to 40% more just because it's natural.
"That's why I am a big fan of integration in the soup aisle," Simon continued.
"I don't expect that Health Valley soup should cost the same as Campbell's, but it shouldn't be a dollar more. We hurt ourselves by price-gouging," he said to an audience that included several retailers.
Earth's Best baby food, made by Hain, is certified organic and kosher and says GMO-free on the label. It should retail at about 69 cents a jar, Simon said by way of example. Conventional Gerber is maybe 49 to 55 cents. "If you see products at more than 10% to 15% higher, somebody's taking margins."