Introduction
This environmental analysis outlines the structure of the Natural and Specialty Food industry by analyzing how the industry functions, the markets it serves, and the competition it faces. It is important to understand what is considered as “natural” or a “specialty” food. The U.S Food and Drug Administration (FDA) does not define the term “natural food”, but the agency has not objected to the use of the term if the food does not contain added color, artificial flavors, or other synthetic substances (FDA, 2014). Often “natural” is synonymous with “organic.” The Environmental Protection Agency (EPA) defines organic food as “food grown and processed using no synthetic fertilizers or pesticides (EPA, 2012). Specialty food on the other hand, includes but is not limited to, organic foods, specialty candies, baked goods, and gourmet foods. Since organic foods are considered as part of the Specialty foods, Natural food was referred to as a sub-industry or a segment in the Specialty industry throughout the report. After analyzing the industry, market and competition, …show more content…
They hold a majority of sales in the food retail industry. (Cite)They are able to buy in bulk for lower prices and in turn sell at lower prices. This is a problem for the smaller scale organic and specialty stores because they have to make up for this price disadvantage with outstanding customer service and experience. The overall quality of organic products has been a strong selling point for these smaller more specialized stores but with the growing demand for organic foods larger chain grocery stores have started to invest in organic sections in their stores. The indirect competition is a large concern for the specialty food industry. It is just difficult for the smaller stores to compete with national chains, which is why the companies in this industry operate in a niche market
This environmental analysis outlines the structure of the Natural and Specialty Food industry by analyzing how the industry functions, the markets it serves, and the competition it faces. It is important to understand what is considered as “natural” or a “specialty” food. The U.S Food and Drug Administration (FDA) does not define the term “natural food”, but the agency has not objected to the use of the term if the food does not contain added color, artificial flavors, or other synthetic substances (FDA, 2014). Often “natural” is synonymous with “organic.” The Environmental Protection Agency (EPA) defines organic food as “food grown and processed using no synthetic fertilizers or pesticides (EPA, 2012). Specialty food on the other hand, includes but is not limited to, organic foods, specialty candies, baked goods, and gourmet foods. Since organic foods are considered as part of the Specialty foods, Natural food was referred to as a sub-industry or a segment in the Specialty industry throughout the report. After analyzing the industry, market and competition, …show more content…
They hold a majority of sales in the food retail industry. (Cite)They are able to buy in bulk for lower prices and in turn sell at lower prices. This is a problem for the smaller scale organic and specialty stores because they have to make up for this price disadvantage with outstanding customer service and experience. The overall quality of organic products has been a strong selling point for these smaller more specialized stores but with the growing demand for organic foods larger chain grocery stores have started to invest in organic sections in their stores. The indirect competition is a large concern for the specialty food industry. It is just difficult for the smaller stores to compete with national chains, which is why the companies in this industry operate in a niche market