Company banks on organic sweet potatoes

03/08/2011 12:28:18 PM
Jim Offner

Sandi Kronick says she is counting on organic sweet potatoes to become more than an easily overlooked niche category.

There is reason, she adds, to think that it will be.

“We’ve seen a lot of growth,” she said, adding that her company, Eastern Carolina Organics, in Pittsboro, N.C., works with regional producers.

“Our growth has much to do with the growth and volume that producers are putting in as much as it has to do with demand. We’re limited by what local producers are growing, but our sales have grown tremendously with organic sweet potatoes.”

The company was launched in 2004, and it has seen steady growth, particularly in the retail sector, said Kronick, the chief executive officer.

“Our biggest markets are the natural and organic retailers and distributors, but others are more conventional,” she said.

What draws them to organic sweet potatoes?

“I think the customers that we sell to might source conventional, as well, but they certainly need to stock organic,” Kronick said. “But what I think possibly sets us apart from other suppliers is the relationship value.”

Organics sometimes can bounce around the price scale, but sweet potatoes don’t follow that pattern as much as other items do, Kronick said.

“Our prices are extremely consistent when it comes to sweet potatoes,” she said. “It’s a pleasure to sell sweet potatoes because of how simple it is, compared with all the other products we represent. That being said, our product quality is consistent, the pricing is solid and it’s a year-round available item.”

The recession wiped out much of the price premium on organic sweet potatoes, but the economic downturn did not hinder sales of the product, Kronick said.

“We had some varieties several years ago we were charging a very, very high premium on,” she said. “In late 2008, when the credit crunch hit, our largest customers were really feeling the pressure. At that point, the only change we really saw was that super-high window on certain varieties of the organic sweet potatoes had to come down closer to your beauregard standard varieties.”

The big premium disappeared, she said.

“But the volume was still solid on your standard varieties, as well as your specialties,” she said.

“No one wanted to offend customers in the supermarket with a super-high price. But the availability of those varieties has stabilized since then and we don’t necessarily need that premium anymore because of the quantity we’re producing on it now, as opposed to back then.”

Other than that, the sales of organic sweet potatoes have been left untouched by the downturn, she added.

“The growth for us in organic sweet potatoes has been tremendous,” she said. “Our company overall grew 50% in 2010 over 2009 and sweet potatoes are our biggest crop.”

The company continues to bring in new customers, Kronick said.

“That one item is a real anchor,” she said. “We’ve been able to partner with the large-volume farms that have very consistent quality and availability and can compete on price.”

Kronick acknowledges that organic sweet potatoes remain a relative blip in the total marketplace.

“Based on some of the larger farms we work with that do mostly conventional, organic is about 1% of their operations,” she said.

Foodservice business mainly is with some universities and distributors, “but it’s not very significant,” Kronick said.

“Certainly for those foodservice distributors we sell to, they’re not coming to us for the organic sweet potatoes — they’re coming to us for specialty greens and things like that,” she said.

“I want to say foodservice is really looking for organic sweet potatoes. I don’t think they find that to be sexy enough to make it worth the price premiums over conventional. As much as I’d love it to be otherwise — I mean, you know, organic sweet potato french fries or sweet potato tater tots would be a very good thing in the system, especially with what’s going on with the schools’ food policy — I’m not seeing anything.”

Sue Johnson-Langdon, executive director of the Smithfield-based North Carolina SweetPotato Commission, said organic product is getting attention.

“There’s definite interest in the organic market,” Johnson-Langdon said. “How that actually winds up playing out into sales, I think a lot of people would think the perception of organic being better is there, whether it is scientifically based or not. I see it as being a part of overall marketing.”



Comments (0) Leave a comment 

Name
e-Mail (required)
Location

Comment:

characters left

Join the conversation - sign up for FREE today!
FeedWind
Feedback Form
Leads to Insight