During the past decade, Stemilt Growers Inc. has made calculated business decisions allowing for seamless growth in today’s organic arena. The company, located in Wenatchee, WA, has been farming organic tree fruit since 1989. Director of Marketing Roger Pepperl said significant changes have occurred since those early years.
“During the past 10 years, there haves been better organic applications and tools tofarm,” he said. “This has [enabled] us to expand production while also increasing production per acre.”
Stemilt began a growth spurt in organics four years ago, and decisions facilitated increased market penetration. One of the biggest production changes involves fruit being grown and marketed. “Most of the organic tree fruit has moved toward the contemporary items that an organic consumer would, of course, want,” he said. “Ten years ago, the mix [of apple varieties] was heavily weighted in Red and Gold Delicious. While it was good fruit, today we are trending to crops that are heavy in Gala, Fuji, Pink Lady, Piñata, Honeycrisp and Granny Smith.”
Although organic pear production has its own set of challenges, Mr. Pepperl said Stemilt is moving a fair volume of organic Bartletts, Anjous, Boscs and Concordes.
All of the company’s peaches and nectarines are organic. “Stemilt evaluated the decision because the crop was in an area that was isolated to the point that organic farming was achievable,” Mr. Pepperl explained. “At a million boxes, it was a large enough crop. But not too large that a 100 percent conversion was in the cards. It gives us differentiation on flavor as well as organic certification. The fruit is beautiful, and we truly have something different at Stemilt. It has become the soft fruit program of choice for many retailers and is sold as their primary soft fruit program. Others use it as their organic program alongside a conventional program from another state.”
He said conventional retailers are following the organic and natural food-oriented supermarkets. The marketplace has changed as a result, and larger selections of organic fruits and vegetables are now available. “Organic shoppers enjoy the four ‘P’s of marketing: price, promotion, placement and the right products,” he went on to say. “This is all happening now. Organic tree fruit is in extremely high demand, and we don’t see this changing.”
The premium price for organic fruit is not deterring consumers. “Not only are they willing to pay a premium, they are and we can’t keep up with the demand,” Mr. Pepperl said. “The premium has to be reasonable like 50 cents a pound at retail. But it is in most cases.”
Consumer purchases of organics are driven by more than price points. “The fruit has to look good and taste good. These are very food-oriented shoppers. They want a good product,” he said. “Good placement is a priority with the proper size displays. Organic shoppers want to be merchandised to. They also are very interested in ‘who grew my food?’ ”
Mr. Pepperl was asked to look down the road five years and provide a map as to where Stemilt will be heading down the organic highway. “You will see more conversion of key items to organic,” he said. “We will do it with the market in mind. The right items and the right amount. The supply can get out of sync real easily. Today there isn’t enough. But tomorrow that could change. The grower needs a premium to farm organically. Without that premium, the orchards revert to conventional production.”