Tuesday, October 22, 2013

An Investment In Future Shoppers.

I've already blogged about the #GMO debate many times, but I think it's important for me to bring some clarity to the issue, to paraphrase the great Todd Glass.

Ok, so we have the Washington state #GMO labeling initiative I-522. If this passes, then most foods that have genetically modified ingredients will have to have a label stating so.

Why do farmers, scientists, science writers, and people in the industry have an issue with this?

First of all, the label serves no safety or educational function. If you buy the wrong kind of flour, your bread may turn out horrible. If you buy something with an undeclared allergen, you could go into anaphylactic shock and possible die. So it's important to label things like what kind of flour because cake and all purpose flour and flour made with summer or winter wheat may function differently.  We label allergens so people can easily see what to avoid... for obvious health reasons.

If you accidentally buy a food with a #GMO ingredient, nothing different will happen to you. Nothing.

So why label it?

Why would the Organic Foods lobby be funding I-522?

For those of you that don't know, foods classified as 'Organic' must not use #GMO inputs in their production.  So at first glance, it would appear that the Organic Foods lobby would have no dog in this fight... so why be involved?

This is where the label's purpose comes into focus...

Ok, so let's say you are Whole Foods and business is pretty good.  Organic food as an industry has been growing at around 25% a year for at least the last 5 years now. Pretty soon, that growth will reach a lag phase and start to level off.  Whole Foods is aware of this and know that they need fresh customers to sustain year over year growth.

Well, one way to guarantee more customers is to tell people your food is intrinsically better because it isn't #GMO.  

So how do you do that?  

You could list all the ways that non-GMO foods are demonstrably better... but what if you can't prove that?  The other option is the tried and true practice of propaganda.  You don't tell them why your food is better, you tell them the other food is so much worse.  Doubt is easy to grow and impossible to discount completely because one cannot disprove a negative.

So you spread propaganda about #GMO and you associate #GMO with big corporations(unlike mom & pop stores like Whole Foods).  You introduce doubt by saying the studies aren't big enough or long enough or independent enough.

The next step for Whole Foods is to warn people about every product you don't want them to buy... a label.

The label serves as a warning or to put it mildly, a reminder to choose a different food.  Now here's the catch: most grocery stores sell conventional foods and have a small organic section.  The organic section isn't really the big money maker and is subsidized by all the regular groceries. Grocery stores in general operate on a pretty thin profit margin.  So when people read what is essentially a warning label, they will start to buy USDA Organic foods, which means that regular grocers will see sales drop on about 90% of it's inventory.

This is where Whole Foods comes in...

Stores like Safeway and QFC will take a big hit to their private brands as well as the nightmare of having to segregate stock for Washington stores from it's distribution inventory for Oregon, Utah, Idaho, etc.  They may even have to close some Washington stores because of this.  But who will be there waiting with their mostly #GMO free inventory and a distribution system already designed to keep certain foods separated?

Whole Foods.

And you can bet Whole Foods can expect to pick up major market share as sales from their competition drops. It will be a major windfall for them.

Soon, Washington residents may have no major grocer to go to except Whole Paycheck, and Whole Foods will be waiting with open arms.