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Multi-National Corporations buy up “Natural” and “Organic” Market

17 Mar

Burt's Bees started out as a small company offering "all-natural" products.  In recent years, they were purchased by Clorox.

Burt's Bees started out as a small company offering "all-natural" products. In recent years, they were purchased by Clorox, which catapulted them into thousands of stores nationwide.

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The following Alternet article highlights the fact that many natural and organic products found in grocery stores today are produced by companies that have been bought out by large, multi-national corporations – the same mega-corporations that produce toxic chemicals with little to no regard for environmental or societal issues.

If you choose to eat “all-natural” and “organic” products from smaller companies because you want to be a conscientious consumer, then take note of the following companies that have been purchased by their larger, mainbrand competitors:

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Burt’s Bees is owned by Clorox

Tom’s of Maine is owned by Colgate-Palmolive

Stonyfield Yogurt is owned by Danone (Brown Cow); the CEO also sits on the board of Dannon U.S.A.

Horizon is owned by Dean Foods (the largest dairy company in the U.S.)

Odwalla is owned by Coca-Cola

Naked Juice is owned by Pepsi-Cola

After the Fall is owned by Smucker’s

R.W. Knudsen is owned by Smucker’s

Santa Cruz Organic is owned by Smucker’s

Smart Water/Vitamin Water is owned by Coca-Cola

Kashi is owned by Kellogg’s

Back to Nature is owned by Kraft Foods (whose parent company also owns Phillip Morris USA)

Cascadian Farms is owned by General Mills

Barbara’s Bakery is owned by Weetabix

Mother’s is owned by Quaker, which is owned by PepsiCo

Health Valley/Arrowhead Mills is owned by Hain Celestial Group, of which 16% is owned by H.J. Heinz

Green & Black Organic chocolate is owned by Schweppe’s.

Dagoba Chocolate is owned by Hershey’s.

The Body Shop is owned by L’Oreal/Nestle

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I highlighted several of these in a previous blog post, “Agri-Corporations Race to Get a Piece of the Organic Pie“, which also included the following chart:

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Organic Company Ownership/Acquisition Chart. Click for enlarged view.

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While I’m not saying that eating organic foods from the above sources is an inherently bad thing – especially if those products are the only ones you and your family have available – I know that it has me second-guessing my choices yet again.  i think that, on one hand, it is good that such large corporations are able to provide these natural products to an even larger consumer base.

On the other hand, many of these mega-corporations utilize the same poor agricultural and manufacturing practices that prompted organic farming and consuming in this country.  Knowing that these corporations also turn out some of the most health-robbing foods in existence makes me want to boycott their “natural” products, too.  How long until they destroy the goodness of organic, all-natural foods?

These corporations didn’t get into organic farming because they care about you or the environment.  They have been witness to double-digit percentage increases in the organic market, and these moves for acquisition and ownership are merely efforts to stay on the cash-cow.  Their efforts are profit/money driven, unlike many of the smaller, local companies that started out in opposition to the practices of mega-corporations, which, ironically, later came to buy them out.

It’s also worth noting that many of these companies are lobbying the USDA to lessen the standards for organic products, and the FDA to loosen up on labeling requirements.

Now, doesn’t that make you want to run out and pick up a product made by one of these companies?

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Burt’s Bees, Tom’s of Maine, Naked Juice: Your Favorite Brands? Take Another Look — They May Not Be What They Seem

My first introduction to natural, organic and eco-friendly products stems back to the early ’90s, when I stumbled upon Burt’s Bees lip balm at an independently owned health food store in the heart of Westport, Kansas City, Mo.

Before the eyesore invasion of ’98, when Starbucks frothed its way into the neighborhood, leading to its ultimate demise, Westport was the kind of  ‘hood I still yearn for. It was saturated with historically preserved, hip and funky, mom-and-pop-type establishments, delivering their goods people to people.

I was surprised more recently when I saw Burt’s Bees products everywhere — in grocery stores, drug stores, corner bodegas and big-box stores like Target and Wal-Mart. I thought to myself, fantastic; the marketplace is working, and good for Burt. He has made his mark, and the demand for his products is on the rise.

Needless to say, I was shocked when I recently found out that Burt’s Bees is now owned by Clorox, a massive corporate company that has historically cared very little about the environment, but whose main industry is directly associated with harmful chemicals, some of which require warning labels for legal sale.

Clorox; yes, that’s right — the bleach company with an estimated revenue of $ 4.8 billion that employs nearly 7,600 workers (now bees) and sells products like Liquid-Plumr, Pine-Sol and Armor All, a far cry from the origins of Burt.

I now understood. The reason Burt’s Bees products were everywhere was precisely because they now had a powerful corporation in the driver’s seat, with big marketing budgets and existing distribution systems.

The story of Burt is a charming one gone bad. Burt Shavitz, a beekeeper in Dexter, Maine, lived an extremely humble life selling honey in pickle jars from the back of his pickup truck and resided in the wilderness inside a turkey coop without running water or electricity.

In the summer of 1984, Shavitz was driving down the road and spotted a hitchhiker who needed a lift to the post office. He pulled over and picked up Roxanne Quimby, a 34-year-old woman who eventually became Shavitz’s lover and business partner. Quimby started helping him tend to the beehives, and that eventually led to the all natural-inspired health care products made with Shavitz’s honey and the birth of Burt’s Bees products.

Burt’s story and very powerful narrative gave Burt’s Bees products their legitimacy in my book. Creative entrepreneurs and knowledgeable consumers together working their magic; not the results of a corporate behemoth out to dominate the marketplace.

However, Quimby and Shavitz’s relationship became ‘sticky’ in the late ’90s for reasons unclear, yet probably having little to do with honey. Their romantic break up carried over to the split of their business partnership as well. In 1999, Quimby bought out Shavitz’s shares of the company for a small six-figure sum. Quimby then continued, becoming phenomenally successfully and growing sales to $43.5 million by 2002.

In 2003, a private equity firm, AEA investors, purchased 80 percent of Burt’s Bees from Quimby, with her retaining a 20 percent share and a seat on the board. In 2006, John Replogle, the former general manager of Unilever’s skin-care division became CEO and president of Burt’s Bees. The company was sold to Clorox in late October 2007 for $925 million.

Quimby was paid more than $300 million for her stake in Burt’s Bees. At the time of that deal, Shavitz reportedly demanded more money, and Quimby agreed to pay him $4 million. Quimby now refurbishes fancy, swank homes in Florida, travels the world and buys massive chunks of land in her free time. Our bearded man Shavitz, on the other hand, now 73 and unchanged, continues to reside amidst nature in his now-expanded turkey coop, which still remains absent of electricity or running water.

The Burt’s Bees story is disconcerting. I vaguely remembered long ago that one of my favorite ice cream products, Ben & Jerry’s, sold out. Unilever (which also owns Breyers), the giant conglomerate with an estimated market cap of $50 billion and close to 174,000 employees, bought Ben & Jerry’s in 2000 for $326 million.

I began to wonder about the other products I liked, trusted and respected for their independence and their social responsibility. How many were really owned by big corporations, who were going out of their way to hide the link between the big corporate company with the small, socially responsible brand? It didn’t take long for my list of disappointments to grow and grow.

[read the rest of the article – page 2 of 4]

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One response to “Multi-National Corporations buy up “Natural” and “Organic” Market

  1. wonker

    March 18, 2009 at 4:17 am

    Interesting blog, I’ll try and spread the word.

     

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