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Organic food, green products go mainstream

By Manav Tanneeru
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ATLANTA, Georgia (CNN) -- At first glance, Sevananda wouldn't seem like one of the pioneers of a multibillion-dollar industry that is transforming the way Americans eat and shop.

The small cooperative grocery -- which specializes in organic and natural foods and products -- was founded in 1972 by a group of yoga enthusiasts who wanted to serve their community and educate their neighbors about healthy eating habits.

Sevananda, which roughly translates from Sanskrit to "joy is service," is owned by its shoppers. Customers pay a membership fee and in return receive a yearly refund, which is a share of the co-op's profits. Membership, however, is not required to shop at the store.

Nearly all of the store's products -- whether it is toilet paper, cat litter, detergent, fruits or vegetables -- fall under the organic banner, said Holly Blain, the store's pink-and-purple-haired spokeswoman.

"Organic" generally refers to foods grown and processed without chemicals, additives, hormones or pesticides. Organic farming is practiced without the use of genetically modified organisms and applies standards that protect the land and water supply.

"It is grown essentially the way food has been grown since the dawn of time," Blain said.

The store grosses $7.2 million yearly, has more than 3,500 members and, along with similar stores across the country, has helped spur a larger movement based on its founding principles.

Behind the numbers

"Buying green" -- a moniker that describes a type of consumerism motivated by a desire to improve the environment, communities and lives -- has taken off during the last 10 years.

Organic food makes up the largest segment of the green market. The U.S. organic food industry accounted for $13.8 billion in consumer sales in 2005. Eight years ago, that number was $3.59 billion.

Meanwhile, high prices at the gas pump, concerns about global warming and an increase in production sent hybrid car sales soaring from around 9,000 in 2002 to above 200,000 in 2005, according to

Hybrid cars are projected to make up 5 percent of the U.S. market by 2013, according to J.D. Power and Associates, a market research firm, up from 1.2 percent in 2005.

The green concept also has entered the construction industry -- studies show that building green can lower utility costs and increase productivity while reducing the impact on the environment, according to the U.S. Green Building Council.

Companies like Bank of America, IBM and Toyota are constructing or have moved into green buildings, according to the Harvard Business Review. Sales of green building products and services have doubled from $5.8 billion in 2003 to $10 billion in 2005, the council found.

Organic's origins

Although the origins of green consumerism and organic foods go back to 1920s Europe, which was roiled by anti-industrialization sentiment, the movement began to gain traction in the late 1960s and early 1970s in the United States.

"A lot of these ideas have been with us for a long time, but they really took off in the 1970s, and I think they were propelled by some very public food scares in the conventional food industry with regard to pesticides," said Samuel Fromartz, author of the 2006 book, "Organic, Inc."

"At that point, a lot of the people who were in the counterculture and the anti-Vietnam War movement began to shift their focus to the environment," he said.

There was another jump from the mid-1990s to the early part of this decade, as the rise of gourmet foods and celebrity chefs brought the organic movement from the margins to the mainstream, Fromartz said.

Meanwhile, rising obesity rates, mad cow disease and documentaries like "Supersize Me," which chronicled the ills of fast food, cast a spotlight on the conventional methods of growing and processing food.

The U.S. Department of Agriculture established standards for what is considered organic in 2002. The "USDA Organic" seal means the product is at least 95 percent organic.

Into the suburbs

Located in the eclectic Little Five Points district of Atlanta, Sevananda's customers -- much like the neighborhood's residents and patrons -- run the gamut from Rastafarians and hippies to college students, hipsters, punk rockers and yuppies.

Meanwhile, a few blocks away and sandwiched between Staples and Borders, a Whole Foods Market is attracting a like-minded but more upscale clientele.

Since its founding in 1980, the Austin, Texas-based chain -- which specializes in organic and natural foods -- has grown to more than 180 stores across the United States, Canada and the United Kingdom, according to Ashley Hawkins, a Whole Foods spokeswoman.

But, unlike Sevananda, which still epitomizes the counterculture that spawned the organic movement, Whole Foods is more representative of the movement's acceptance by the mainstream.

"People are really embracing a healthy lifestyle these days and are looking for a place that is selling a healthy lifestyle, and that's what we are providing," Hawkins said.

The store has widely spaced aisles, high ceilings, bright lighting, a salad bar, a hot bar and sidewalk bistro tables where customers dine. And while Sevananda's checkout aisles carry magazines announcing progressive politics, Whole Foods has Oprah's magazine and other titles found at many other grocery stores.

"What market researchers say is that there is not one organic shopper anymore," Fromartz said. "It's not the counterculture hippie or the Prius-driving mother anymore. It's a much broader market."

The price of success

Observers question whether success has diluted the movement's ideals.

"It's a concern that comes with the industrialization of organic," Fromartz said. "Once it succeeds, it's not necessarily the idealists that are playing anymore."

Companies and retail chains like Wal-Mart, Frito-Lay, Kraft, Dole, Target and others have begun carrying organic products.

Michael Pollan, author of "The Omnivore's Dilemma: A Natural History of Four Meals," was ambivalent over Wal-Mart's entry into the organic market in a recent New York Times article.

"Because of its scale and efficiency and notorious ruthlessness, Wal-Mart will force down the price of organics, and that's a good thing for all the consumers who can't afford to spend more for food than they already do," Pollan wrote.

Also, the amount of chemical-free farmland needed to satisfy Wal-Mart's demand will help the environment, he wrote.

However, Pollan was skeptical of how Wal-Mart intended to keep prices low, wondering if its "ruthlessness" would eventually force organic farmers and suppliers to cut corners. He also expressed fears that large corporations could co-opt the organic market and lobby to loosen USDA standards.

Asked for comment, a Wal-Mart spokeswoman pointed to a statement found on its Web site: "We believe strongly that USDA standards for organic products must not be compromised. Our customers who buy organic products expect them to meet these standards, so we feel they must be maintained."

In a Fortune magazine feature published in July, Wal-Mart chief executive Lee Scott said the company's green campaign signaled a fundamental shift in the way it would do business.

"There can't be anything good about putting all these chemicals in the air. There can't be anything good about the smog you see in the cities," Scott told Fortune. "Those things are just inherently wrong, whether you are an environmentalist or not."

Wal-Mart plans to invest $500 million in sustainability projects, increase the efficiency of its vehicle fleet by 25 percent over the next three years, eliminate 30 percent of the energy used in stores and reduce solid waste by 25 percent, the magazine reported.

Asked about the growing competition from the big chains, Sevananda's Blain sounded largely unconcerned: "The more people you can maybe turn away from eating stuff that is junk and for your own health and for the health of the ecology and environment you live in, [the better]."

Organic food sales jumped from $3.59 billion eight years ago to $13.8 billion in 2005.




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