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Walmart And Organic Food: Match Made in Heaven?

The Washington Post reports that Walmart (yes, that Walmart) is making big plans to bring its compete-on-price approach to organic food.

 

Wal-Mart announced Thursday that it will soon begin stocking shelves at about 2,000 locations, including those in the Washington, D.C., region, with 100 pantry items, such as canned vegetables, spices and condiments, produced by organic food company Wild Oats.

Those products won’t carry the same price markups found on other organic-label food, allowing Wal-Mart to continue its compete-on-price strategy that has made it a mecca for cost-conscious shoppers and a pain for retailers who often lower their prices to compete.

Of course, we’ve seen this story before.  Walmart uses it’s heft and size to bargain down prices from its suppliers and its operational efficiencies to cut down on distribution costs, resulting in what seem like lower prices for the consumer.  However, this strategy has come at a cost, as, amongst other things, local economies frequently languish resulting in less jobs, and the jobs that Walmart “creates” are low wage and end up costing taxpayers (as you can see in the video below)

 

At the same time, Walmart going big on organic has the potential to have a very substantial impact in shifting the food industry towards more sustainable (and hopefully healthier?) goodies and making organic food more broadly accessible.

 

The company also can give an organic food manufacturer such as Wild Oats greater certainty about the amount of food it will need over time, thus eliminating some of the unpredictability and risk that come with investing in organic food production.

 

So with those pluses and minuses….what do you think?  Are you a fan of Walmart bringing it’s low-cost approach to organic food?

 

Yes?
No?
Maybe so?

 

Photo Credit: ABC News

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