Fruits and vegetables with “organic” labels continue to bode well for retailers, with sales of organic produce climbing 8.7% to $5.6 billion in 2018, according to the United Fresh Produce Association’s latest FreshFacts on Retail report.
As more organic varieties flood grocery stores, consumers are increasingly aware of the category and claim to find organic produce healthier, tastier and more nutritious, the report says. As such, retailers have an opportunity to further the category’s expansion by innovating and attracting health-conscious consumers as shopper awareness and perception of organic produce continues to improve.
Despite the growing demand for healthier foods, the produce department overall generated $60.8 billion in sales in 2018—a 1.7% increase over the year prior—marking the lowest growth rate among all perishable categories, including meat (3.1%), deli (6.6%), bakery (3.8%) and seafood (5.9%).
Yet the report, produced in partnership with Nielsen Fresh, also revealed that fresh produce continues to play an important role in fourth-quarter holiday sales. The produce department generated $14.3 billion in the fourth quarter, accounting for 32% of all fresh sales, second to the meat department. Broccoli led that growth with a 12% increase, as new innovations hit store shelves, along with premium products such as blueberries, raspberries and strawberries, which rose 12.4%, 10.9% and 2.5%, respectively.
Value-added items also continue to be a growth driver, with packaged sales leading the category despite seeing sales decline 2.7% in the fourth quarter compared to last year.
“Thanksgiving and Christmas are two of the most important weeks of the year for retail and the food industry,” said Miriam Wolk, VP of member services at United Fresh, in a statement. “The data provided in FreshFacts will help readers understand sales trends and plan for future promotions.”
The report also found that shoppers spend more money—an average of $60—in the store when produce is included in the transaction, compared to $47 without a produce item. However, 50% of trips to the store do not include produce, according to the report.