Organic box provider Abel & Cole has insisted it is well placed to weather the recession despite admitting its sales growth has slowed from 40% two years ago to single-figure increases today.
The company's sales shot up from £19.8m in the year ending August 2006 to £27.9m the following year, but sales have slowed in recent months. Customer numbers have also levelled off at 40,000 to 50,000.
Its sales growth this year had come through increasing its product range and encouraging customers to buy more meat, fish, milk, bread and pantry items, MD Duncan Gibson told The Grocer.
Plans for a physical shop have also been "put on hold" because of the credit crunch. "We remain in growth but we are having to work harder than ever to maintain that," he said. "It's a really tough time for us but we would still be in single-digit growth at the moment."
However Gibson insisted that organic food could defy the tough trading environment. "People are going to want to eat out less and cook more at home, so there's a real opportunity for us in the current market," he argued.
Costs had been reduced through working with suppliers and Phoenix Equity Partners, which last year bought a stake in the company, Gibson claimed.
The value of organic goods compared to conventional products had also never been better because organic production used less petrol, he added. "We don't need as much fuel or energy as standard production - the biggest user of energy is fertiliser. About 75% of what we sell comes from the UK so transport costs don't have the same impact on us and we have had fewer inflationary pressures."
Organics had also become more accessible to consumers, he said. Abel & Cole introduced an 8% price rise on its boxes in May, but Gibson claimed this was outweighed by increasing the content of the boxes by 20% in weight in the summer, while other products such as fish had also decreased in price.
The company's sales shot up from £19.8m in the year ending August 2006 to £27.9m the following year, but sales have slowed in recent months. Customer numbers have also levelled off at 40,000 to 50,000.
Its sales growth this year had come through increasing its product range and encouraging customers to buy more meat, fish, milk, bread and pantry items, MD Duncan Gibson told The Grocer.
Plans for a physical shop have also been "put on hold" because of the credit crunch. "We remain in growth but we are having to work harder than ever to maintain that," he said. "It's a really tough time for us but we would still be in single-digit growth at the moment."
However Gibson insisted that organic food could defy the tough trading environment. "People are going to want to eat out less and cook more at home, so there's a real opportunity for us in the current market," he argued.
Costs had been reduced through working with suppliers and Phoenix Equity Partners, which last year bought a stake in the company, Gibson claimed.
The value of organic goods compared to conventional products had also never been better because organic production used less petrol, he added. "We don't need as much fuel or energy as standard production - the biggest user of energy is fertiliser. About 75% of what we sell comes from the UK so transport costs don't have the same impact on us and we have had fewer inflationary pressures."
Organics had also become more accessible to consumers, he said. Abel & Cole introduced an 8% price rise on its boxes in May, but Gibson claimed this was outweighed by increasing the content of the boxes by 20% in weight in the summer, while other products such as fish had also decreased in price.
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