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Nils El Accad, CEO, Organic Foods & Café.

Speciality retail remains a flourishing and resilient sector in an industry beset by issues surrounding inflation. Retail News reports.

"Not much has really changed. We are not much different from conventional rice anymore in terms of pricing so that has worked in our favour and we haven't needed to increase things that much," responds Nils El Accad, CEO of Dubai's Organic Foods & Café, when asked if the chain has been hit by problems driven by rising costs.

"Our disparities came with the exchange rates; the dollar started to become weaker and that affected us a lot. We took long-term contracts and have price agreements with farmers. They look at the costs of production, rather than worldwide prices."

The city's best known organic retail chain and distributor is braced for further expansion as the direct juices and cold pressed oils filling its shelves and the biodegradable trays lining its ovens continue to lure middle-class epicureans and green devotees to its specialist offering.

"I've witnessed other retailers trying to do organic, but they've bought in the cheap products. They are so concentrated on other things. It's not about the food and the nutritional issues, but rather about sales figures. With that attitude, you're not listening to the customer. They don't have the right shopper profiles," he blasts. 

To bolster the health of the speciality retail sector, he backs calls for "rents and cost structures have to come down, to make it viable," and reveals plans to take the distributor's brands into the general supermarket sector.

"We will go market-wide and distribute 30 SKUs of HiPP Organic baby food, an organic brand that's high quality and mainstream in Europe and we have already put it on the shelves at Spinneys and Carrefour."

At the end of the 19th century, German confectioner Joseph HiPP turned his skills to producing a satisfying food for his twin babies. Word spread and as the HiPP family grew so did the fame of Joseph's special milk-enriched rusk flour. The HiPPs began selling the flour to friends and neighbours.

By 1932, their son Georg had developed the baby food side of the business and split away to become a separate operation. In 1956, when most farmers were going over to intensive farming, HiPP converted the family farm into one of the first organic farms in Europe.

In 1995, Claus HiPP introduced this exciting organic concept into the UK. By now the HiPP organic product range had grown to encompass infant and follow-on milks, first tastes and toddler meals, and a wide choice of breakfasts, savouries and desserts. HiPP is now positioned as one of the largest organic producers in the world.

The products have gained momentum in the Middle East market stemming from the certified-organic ingredients, absence of harmful pesticides, GM ingredients, antibiotics, growth-promoting hormones, artificial colours and preservatives, and the use of free-range meat.

Organic Foods & Cafe will push 10 SKUs from Nature's Path cereals and bars portfolio into major chains across the region and "those two brands are areas of concentration to break out of the organic retail setting into the mass market. It's going to take time but we have already witnessed positive results at other outlets."

"Mothers are willing to pay the price for baby food, whereas cereals are a bit harder as a category. Organic foods are still attractive to consumers while they watch costs as the health trend is growing stronger and stronger. In the UAE, traffic and air pollution have raised a lot more questions."

El Accad claims the chain pioneered the concentration on environmental issues, currently emerging from bigger companies. "We started out three years ago with reusable bags, we don't use petrochemicals and we only use recycled paper at our company, whereas other retailers are just waking up to these concepts now."

He argues that other chains are flaunting environmental credentials in their bid to "grab customers' attention and latch onto a current issue, maybe they're trying to bring in more money by charging for bags."

Organic Foods & Café's upcoming distribution centre will feature sun pipes and natural lighting and "we're slowly phasing in 1ltr cars across our fleet, paying more for R22 refrigeration and urge all companies to use smaller cars."

The company's flagship store at the Dubai Mall will span a total area with warehousing of 25,000ft² and "it's going to give you the ability to be organic and environmentally-friendly in all aspects of your lifestyle, from paint to clothing and toys."

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