Demand for Organic Food Products Online in India on the Uptick

Got Organic Product             ?  ? ? ? ? ? ? ? ? ? ? ? ? ? ?

That's the question more and more consumers are asking in supermarkets across the nation. Sales of organic food have grown dramatically over the last decade - soaring from $3 billion in 1997 to more than $10 billion in 2003, according to the U.S. Department of Agriculture.

Sales of organic food have grown by 20 percent annually, and experts predict that the industry's share of the U.S. food market is expected to grow from about 2 percent to roughly 3.5 percent by the end of the decade.In fact, demand for organic food is growing so fast that consumer demand is outstripping some domestic supplies.

Consumers are increasingly buying organic products when grocery shopping, with 89% of organic buyers purchasing organic dairy products and 25% always buying organic dairy products, according to a study by the Organic Trade Association (OTA).

Demand for organic food is likely to grow, experts say, because consumers are more likely to see organic food supplements as a healthy and nutritious option to conventionally grown products, studies show. The fact that organic vitamins, minerals, and nutritional supplements are QAI certified organic, vegetarian, and easy to digest and other benefits (see here).

In India, there has been a rising awareness about ingesting chemical-free produce, owing to this the country has witnessed the start of numerous online retail ventures that are associated with the selling of organic products such as organic supplements, organic teas, whole-food supplements, organic, probiotic supplements, vitamins, multi-vitamins & herbal.

According to Mr. Anand Agarwal, Chief Executive of Natural Mantra,

in the past couple of years, there has been a significant rise in the number of people who prefer organic goods such as – home care, food or clothing.

Mr. Agarwal has earlier worked with the leading IT companies like Accenture and Infosys, joined organic sector and purchased a stake in the company (Natural Mantra) which was founded in 2011. He added that the sales are soaring at 40%, on a daily basis. He strongly believes that the company, which was supported by Freemont Partners as its initial stage investor, has the potential to earn a profit in two years and can go on to earn a revenue of Rs. 50 crore by 2016.

Some of the leading portals such as MyGreenkart, GrocBay, Farm2Kitchen, GreenNGood, and Down2Earth are striving hard for a share in the organic food market. As per Assocham estimate, the industry will reach Rs 6,000 crore by 2015. There is a rising demand for the organic foods in small cities and towns.

As per a survey conducted by Moraka Rural Research Foundation, it was found that around 1,000 consumers, in ten cities comprising of Gorakhpur, Nagpur, Allahabad, found that around 30% make use of organic products. The best part is that they are ready to pay 20% more for it.

As per Pragya Singh, associate director at Technopak,

the main reason behind this surging demand is the rising awareness about the healthy well-being.    

Mr. Mukesh Gupta, director-operations at Moraka Organic Foods, comments that

online grocery stores play a pivotal role in the expansion of the customer base and mainly focusing the young couples and parents with young siblings.

This Jaipur based company witnessed a business of Rs. 70 crore which was done via online orders only

.

He is expecting this number to rise as the company is eyeing a revenue of Rs. 150 crore by 2014. Various entrepreneurs are of the view that there is not enough supply to combat the rising demand. He also added that the company functions through a dynamic farmers network which is formed via Moraka Foundation.

Mr. K.S.Bhatia, Founder of DietKart.com (an online mall for health & fitness), said that 

Organics are a niche market in agriculture with a growing market share, so it makes sense to allow farmers to invest some of their own funds to promote their products .We have also increased our efforts towards this direction by joining hands with organic brands and farms such as Organic India, Health-Aid .

The company is expecting, organic food to contribute Rs 35 crore towards sales by 2015. Families purchasing organic foods are important to retailers of all types as organic buyers report spending more per shopping trip as well as shopping more often than those who never purchase organic foods.