Do Consumers Trust Walmart to Sell Organics?

WalmartWalmart recently announced their partnership with Wild Oats to sell a list of 100 new packaged organic food. At first glance, this seems like a great idea to put make healthier foods more accessible to everyone. The question is, will people trust Walmart enough to buy organics from them? Their history leads consumers to be weary of trusting whether the items are actually certified organic or just carrying the label.

WalmartThe big box discount store is using their buying power to score mass amounts of organic products at rock bottoms prices, including olive oil, spices, pasta, beans and boxed goods. Doing so gives them an advantage over their competitors, allowing them to undercut their prices by as much as 25 percent.

The problem is, people do not exactly trust Walmart. First of all, The public’s reaction to Walmart’s decision to expand their line of organics has not all been positive. Many people have decided to boycott the discount long before they made the announcement that they will be selling a new line of organics. Many consumers will not shop there at all because of the unfair wages paid to their employees and their ability to put smaller stores out of business by undercutting their prices. One report states that taxpayers pay over $6 billion per year for benefits paid to low-paid and uninsured Walmart employees.

Secondly, they have had problems regarding selling organics in the past. Their store-brand organic milk is produced by Aurora Dairy, which was found to be in violation of organic standards in 2007. In 2010, Walmart was accused of mismarketing organic products. The USDA received a complaint that Walmart was selling pest control products labeled organic that contained conventional oils.

In 2011, Walmart stores in China were forced to close their doors after allegedly selling fake organic pork. They supposedly capitalized on an outbreak from tainted pork sold from other stores and in order to meet customer demand and make more money, they labeled regular pork as organic and charged more for it.

Then there is the fact that organics costs more for a reason. The process of organic farming differs from conventional farming and is more cost prohibitive. They do not receive the same government subsidies as a traditional farm either. The added cost is passed down to the suppliers and the customer. The fact that Walmart is selling cheap organics leads people to questions their business practices. They have been known to squeeze the companies they work with until they bleed. If Wild Oats wants to do business with the superstore, they need to meet their demand and do so at a lower cost.

Another thing that concerns people about the expanding organics at Walmart is the effect it will have on the countryside and on conventional farmers. Producing the mass amounts of organic crops will likely change the landscape of farming. They will have to push out small farmers to make room for the larger organic farms.

If consumers did not trust Walmart before, they are not likely to start shopping there for the new line of organics they plan to sell soon. History shows that just because their labels claim they are organic, it does not guarantee that they do, in fact, contain only certified organic ingredients.

By Tracy Rose

Sources:

Consumer Reports
KCET
New York Times Blog
Tree Hugger
Cornucopia

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