Heinz is so keen to grow its presence in organic and functional foods it has restructured its core businesses. It has set up a new category, to run parallel to its other core areas, that will focus on organic and functional foods, which it sees as a "major growth opportunity". The company has invested heavily in the sector in the past year ­ it bought a 20% stake in organic manufacturer Hain Foods and the Linda McCartney brand of vegetarian and organic foods from United Biscuits. President and ceo William Johnson wants to be a world leader in organic food production. "The category is growing at a 15-20% rate in the US and is expected to expand in Europe at 25% annually over the next four years," he said. Johnson has appointed ex-ConAgra vice president for meals Sharon Wicker to run the category. She said it was crucial for Heinz to see organics as a key growth area and hinted at major brand and business acquisitions. "A global strategy for organic and nutritional foods will enable us to quicken the growth of our existing brands, expand them into new regions and buy new ones," she said. But analysts remain sceptial about the potential of the sector to pull flagging food giants out of financial trouble. They say it will help boost sales but is no panacea. One agreed companies have been quick to capitalise on consumers' demands for functional foods. "But these categories, although growing, are still fairly small ­ it's positive, but still modest," said the analyst. {{NEWS }}

Topics