14 March 2016 - LONDON--(BUSINESS WIRE)--According to the latest market study released by Technavio, the organic food and beverages market in Europe is set to reach USD 39.04 billion by 2020, growing at a CAGR of close to 7%.

Supermarkets and hypermarkets accounted for a share of 41%-43% of the organic food and beverage market in Europe in 2015, in terms of revenue. “Supermarkets and hypermarkets in Europe are increasingly stocking various organic food brands, expanding shelf space for organic food, and launching their own organic food labels. All of these factors have contributed to sales growth. Some of the leading retailers in Europe are Carrefour, Auchan, and Tesco,” says Vijay Sarathi, a lead analyst at Technavio for the non-alcoholic beverages sector.

The grocery stores segment accounted for a 25%-27% share of the market in 2015, in terms of revenue. The segment includes independent store owners, convenience stores, specialty stores, and forecourt retailers. These small grocery stores are losing their share to large retailers and supermarkets because organic food and beverage products have become mainstream. Leading supermarket chains such as Tesco have launched their own private-label organic products. However, sales from specialty organic stores will continue to increase during the forecast period, as they provide a wide assortment of organic-only products.

The online retailing segment accounted for a 6%-8% share of the organic food and beverage market in Europe in 2015 in revenue terms. “Online grocery shopping is still at a nascent stage but is likely to grow in the coming years as consumers increasingly seek convenient shopping. The online share of total grocery sales is expected to increase in all major European economies during the forecast period,” says Vijay.

The online share of grocery sales is expected to increase in the UK from 12% in 2013 to 15% in 2018 and in Germany from 7% in 2013 to 10% in 2018.

The others segment includes discount stores, direct sellers, and other non-store retailers. This segment accounted for a 24%-26% share of the market in 2015. The sales of organic foods and beverages from large discount stores are high in Europe, as consumers seek value in terms of pricing and organic products are generally expensive.

Photo: Fruits at a grocery store (Free domain)

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