Wal-Mart in Pricing Deal with Wild Oats to Push Organic Food Purchases

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Wal-Mart in Pricing Deal with Wild Oats to Push Organic Food Purchases

Wal-Mart Stores Inc is trying to encourage Americans, even those with limited means, to buy more organic foods.

The leading grocery seller in the US said on Thursday that it will be selling organic foods produced by Wild Oats at non-organic rates.

The deal has the potential to give another lease of life to Wal-Mart’s dwindling grocery sales and enhance the profile of the revived Wild Oats brands.

As ABC reports, Wal-Mart and other mainstream stores are in competition to stamp their authority in the organic foods market, as more consumers of varied financial backgrounds seek to eat healthier. Thus, analysts believe that the retailer’s main rivals such as Campbell Soup Co. and ConAgra Foods Inc may begin to feel the pressure from the move to lower prices of their own organic brands.

While about 4% of total US food sales in 2012 was accounted for by organic foods, the category has grown quicker than the industry generally, backed by increased interest in simpler foods made from organic substances.

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Natural foods are often priced higher than other types, putting the niche products below the reach of budget US shoppers who are needed to push it into a nationwide consumable.

Wal-Mart targets the segment and says it will be selling Wild Oats foods at a price that matches conventional foodstuffs, which will be at least 25% below that of branded natural foods. The Wild Oats brand will include common foods such as salsa, tomato paste and canned black beans.

“If we can make that price premium disappear, we think it will grow much, much faster,” Jack Sinclair of Wal-Mart US said while referring to the retailer’s fast-growing organic food sales.

According to Reuters, Sinclair said a study by Wal-Mart found that 91% of its customers would buy organic foods if offered at affordable rates.

Organic foods sales are set to keep going up.

To contact the reporter of the story; Yashu Gola at yashu@forexminute.com