The demand for organic products as well as the number of suppliers who sell them in your assortment is increasing year by year. According to a study by the Bund Ökologische Lebensmittelwirtschaft (BÖLW), the organic sector's turnover grew by around 10 percent in 2016. However, this is not only due to the fact that products from organically controlled sources are currently in vogue. More and more people are paying more for the high standards, the plus in transparency and the sustainability concept. In addition, up to 80% of Germans do not want genetic engineering in the field and ultimately on the plate, according to the publication of the BÖLW.
This is good news for organic shops, supermarkets and discounters alike. Now the increased interest in organic products is not only noticeable in the stationary retail trade at the counter, but also in e-commerce. And this poses a particular challenge for some online retailers - both in terms of the volume of orders as well as very elementary things in terms of eco and organic.
When is certification necessary?
If you want to produce, process or import organic products, you must have EU-Bio-Certification. These companies are then also entitled to bear the organic seal. Suppliers who supply retailers with organic products must also meet the requirements of the control procedure of the EU regulations for organic farming and must therefore have the corresponding certification. It is important that the certification also applies to the respective product group that the supplier wishes to deliver.
Wholesalers, C+C markets or drop-ship traders (companies that purchase organic goods from suppliers and resell them to their customers without having had physical contact with the products) are also covered by the control obligation. Stationary retailers have it much easier: no organic certification is required to be allowed to sell organic products directly to the end customer. Unless
- the organic product is processed on site, e.g. baking bread, slicing and pre-packaging sausage or cheese (unless it is done in front of the customer and the organic product is clearly labelled as such), marinating meat, milling coffee, etc.
- The organic products are not stored at the point of sale, but in an external warehouse or by an external service provider.
So it says in § 3 Öko-Landbaugesetz [ÖLG] Absatz 2 literally:
"*Operators who supply products within the meaning of Article 1(2) of Regulation (EC) No 834/2007 as organic products or products in conversion directly to final consumers or users shall be exempt from compliance with the obligations laid down in Article 28(1) of Regulation (EC) No 834/2007 insofar as they do not produce or have produced, prepare or have prepared these products themselves, store them or have them stored at a place other than a place in connection with the point of sale or import them from a third country or have them imported from a third country.
The storage of organic products at the premises of the trader does not require a separate storage area. However, it must be ensured that all organic products can be identified without any doubt and that they cannot be mixed, confused or contaminated with conventional, i.e. non-organic products. For this purpose, the organic products could, for example, be clearly labelled on the shelf or at the storage location or stored in the original containers. If all these points are observed, storage is also exempted from the control procedure and therefore no organic certification is required.
Whoever as a retailer decides to advertise and sell organic products online could mistakenly assume that this would work without certification. This is a fallacy with legal and financial consequences. In short: Online traders need organic certification - this was also confirmed by the OLG Frankfurt in a court decision of 30.September 2014, Aktenzeichen: 14 U 201/13. There is a risk of high administrative penalties or competition law warnings from competitors.
It doesn't matter whether it's just a single article or a whole range of different products in the online shop's range. The decisive factor here is that, in the opinion of the Frankfurt Higher Regional Court, sales via online trading do not correspond to the characteristics of direct sales to the end customer as assumed in § 3 Paragraph 2. Online traders who wish to sell organic products must therefore obtain EU organic certification.
Not every online retailer can or wants to take care of logistics and Shipping-processing of his products. Especially when selling organic products, these aspects are of special interest for the customer after his order in the online shop. Because it is not only important where a product and its ingredients come from, under what conditions and quality standards it was produced or exactly what it consists of. It is equally important for consumers to know whether the goods ordered are stored, packaged and shipped in accordance with organic criteria.
The online retailer owes this transparency to the customer. On the other hand, the organic certification requires exactly this from a shop operator - otherwise he would not be allowed to carry an organic seal or sell organic products. Goods acceptance, storage, packaging, dispatch or the processing of returns, however, also require a lot of time and personnel resources. And these can be used much more effectively in other areas, for example in sales or to improve service and product quality.
Fulfillment: Practical for organic retailers
Many online traders of organic products now rely on the fullfilment service provider or biologistics provider. It goes without saying that they must also be EU organic certified and fully meet the high standards. At the same time, these biologistics providers can make full use of their experience and know-how and further optimize and smoothly design the processes before and after an order in the retailer's online shop. They ensure the maintenance of high standards and quality assurance from A to Z:
- Complete handling of logistical processes from goods receipt and storage to goods issue
- Clear separation of biological products from conventional goods
- Protection against contamination of products
- Accurate documentation for 100% traceability of goods movements, batches and best-before dates
- Storage of goods at optimum temperature and correct adherence to the cold chain
- Declaration of organic products on delivery notes and invoices in accordance with the guidelines
- Fast and error-free delivery to the customer
Logistics outsourcing or fulfillment therefore also offers companies and traders from the organic sector a high time and cost saving potential. The focus is thus entirely on the core business.
Get in contact with us now
We look forward to learning more about you and your project.