TWO CHAINS FORGE LINKS TO ORGANIC FOOD FIRMS

MARYELLEN LO BOSCO

Sending another signal that natural/organic food has gone mainstream, two of the nation's largest supermarket chains, Albertson's and Publix, have made corporate commitments to provide such alternative items.

Publix Super Markets, Lakeland, Fla., is expanding its natural/organic selections, and is drawing attention to the program with new signage, according to industry observers. Similarly, Albertson's, Boise, Idaho, is dedicating a frozen-food door to natural/organic foods in its more than 800 stores, according to Andy Berliner, chief executive officer and co-owner of Amy's Kitchen, Santa Rosa, Calif. The door will carry 17 Amy's items and 11 stockkeeping units from Cascadian Farm, Sedro-Woolley, Wash.

Albertson's is also expanding organic selections in its grocery aisles by bringing in products from The New Organics Co., Boston. The chain currently has all 24 stockkeeping units available from the company, which was formed six months ago by former Ahold USA, A&P Canada, Star Market and S&D Foods executives.

Officials at both Publix and Albertson's did not return phone calls from SN.

The New Organics products -- which include pastas and sauces, salsa, dressings, tortilla chips, pretzels and pancake and waffle syrup -- are in place in Albertson's Western divisions, which comprise 481 stores.

Jeff Russell, executive vice president of Impact Sales, the brokerage handling Albertson's expansion of natural-food selections, expects the rollout of the frozen-food door to be completed in several weeks.

"The Florida division will be coming on line, and we've got retail people setting the Idaho division," Russell told SN.

The Phoenix division of Albertson's has approved signage that goes across the top of the door and reads "Organic Frozen Food."

Both Amy's and Cascadian Farm products are organic and vegetarian. Amy's is the market leader in frozen vegetarian lunch and dinner entrees, with a 52% share. Cascadian Farms is the second largest supplier, with a 15% share.

"Albertson's is deliberately focusing on the organic lines because they're a real point of difference," noted Berliner of Amy's.

According to Russell, Smith's Food & Drug Centers, Salt Lake City, has had success with its one-door frozen organic program, now entering its second year in some stores.

Rick Walsh, director of mass-market sales at Cascadian Farm, attributed the Albertson's program to competition from Austin, Texas-based Whole Foods, which is expanding. He added that Albertson's is concerned about filling the needs of all its customers with a variety of products.

Albertson's is carrying Amy's entrees, pot pies, pocket sandwiches, pizza, dinners, and its vegetarian burger, and Cascadian Farm's vegetables, strawberries and "veggie bowl" entrees.

What's unique is that the organic lines are coming through Albertson's warehouse system, which lowers the retail price by between 15% and 20%.

Albertson's New Organics grocery line is also coming through the warehouse. "These items are priced at a parity with comparable national brands," Russell said. Albertson's is considering stocking the line in Texas and Florida, Russell noted.

Meanwhile, the Publix natural/organic signs are expected to be in place this month. They will be 3-inch-wide static cling strips that run across the door, according to Judd Vining, a broker at Sales Mart, Tampa, Fla.

In addition, the doors will carry a 3-inch-by-5-inch sign with both Publix's and Amy's name on it. According to Berliner, the sign will say "Publix's and Amy's delicious, natural and organic frozen meals," as well as carry the Amy's tag line, "healthy eating for busy people."

Publix, which made a corporate decision to begin carrying a cross section of Amy's products in its more than 500 stores just two months ago, will offer 11 Amy's items, including entrees, pot pies and vegetarian pockets. The rest of the door will be filled out with meatless analogue items (burgers, breakfast sausages and so forth) from such companies as Morningstar Farms and Green Giant.

Publix is reported to be pleasantly surprised by customer responses to the sections, according to Berliner, Vining and another industry source.

"Publix is very happy with the movement, which is coming without any promotion or demoing," Berliner said.

An industry source close to Publix noted that while some Publix stores have carried Amy's, this is the first chainwide commitment to natural products.

"It's a growing segment that needs to be recognized. They tested it and saw it was good and expanded it," he said. "And there is a lot more room for [organic and natural products]," he said.