A boom in the organic market from the Reformhaus Müller chain of stores. With 37 branches and around 300 employees, Reformhaus Müller is one of the largest organic chains in Switzerland. The mood in the industry is depressed following Tuesday’s bankruptcy report, as Blick’s interviews with various industry representatives show.
For example with Carsten Hejndorf (55). He is the managing director of Bachsermärt, which specializes in sustainability and has five branches in the canton of Zurich. “When I heard the news that Müller had gone bankrupt, I was sick to my stomach,” says Hejndorf. “We have regular customers, but we noticed that the shopping cart is not that full anymore.”
Reformhaus Müller also cited the decreasing frequency of customers as the reason for the bankruptcy. “Since 2016 we have lost 50 percent of our customers,” said Mischa Felber (38), from Reformhaus Müller.
You can buy organic anywhere today.
At first glance, it’s surprising that organic markets and health food stores are struggling when sustainability is in vogue. However, it is precisely this trend that is now deadly for specialist providers who are often pioneers in this field. “Many department stores have also entered the organic world,” says Andreas Lieberherr, 58, of Bio Partner, a food wholesaler that supplies health food stores and other retailers. “Customers can now buy organic from Migros, Coop, Aldi or Lidl.”
The product range has become wider and more diverse. “Previously, you used to do the bulk shopping at the organic store,” says Lieberherr. Today, the customer travels extra to an organic store only for very special products or is a regular customer. Carsten Hejndorf from Bachsermärt also confirms this impression.
Organic trend flattens in 2022
Price is also decisive: Migros, Coop and other major retailers have more room to offer products at lower prices. Smaller chains like Reformhaus Müller are left behind.
“As with hyperbole, many customers get on the same train first,” says Lieberherr. After the scam, it becomes clear who buys organic with faith. Looking at the figures, it is seen that organic product sales increased rapidly between 2016-2021. The curve flattened in mid-2022. Specific information is not yet available as assessments are still ongoing.
Continued inflation is likely to play a role here as well: when money is tight, people tend to prefer cheaper conventional products over the more expensive organic produce.
Expensive branches in prime locations
In addition to the fading organic hype and fierce competition from major retailers, the leading branches of Müller’s health food store have also been deadly. The flagship was located on the Rennweg in Zurich, next to luxury boutiques and international chains. Reformhaus Müller also operated a branch in Zurich main station.
“The branches at Rennweg and Zurich train station are very good and certainly not cheap,” says Michael Dressen, 49, retail real estate specialist at international real estate service provider CBRE. “The rents in these top places are naturally high. If customers find the same products in stores near their home, there won’t be enough customers in Rennweg,” says Dressen.
Finding new tenants is no problem
Also, the people passing by the shops have a good frequency, but there are a lot of tourists. They rarely go shopping at an organic store. On the Rennweg, at the Zurich main station and at other Müller locations, leftover shops should sell like hot toast. Dressen received several inquiries from interested parties. “Finding someone new in such an important place won’t be a problem.” Blick knows of a shoe store in eastern Switzerland that wants to take over the Zurich branches.
Carsten Hejndorf from Bachsermärt is not interested in vacant branches in Zurich. It currently operates three stores in Zurich, the other two at Bachs and Eglisau ZH. Despite inflation and the flattening organic trend, he remains optimistic: “We haven’t lost any customers and we can stand out from the standard organic range of major suppliers.” Especially since fresh produce is sold in small organic shops like Bachsermärt. “This means we have a wide range of fresh vegetables, dairy products and breads.” No major retailer can offer this.