Macro enjoys return to wholesome sales

Macro's co-founder and chief executive, Pierce Cody, said he could not explain why but, after the school holidays had finished last month in Victoria and NSW, sales across his nine stores had immediately recovered and expansion plans for 30 to 40 stores nationally within four years remained realistic.

Macro's revelations follow a new report on the Australian organic sector by the University of New England's Organic Research Centre and Biological Farmers of Australia that shows organic retail sales last year had more than doubled since the last large study was done in 2004, to $578 million.

Mr Cody said the recent improvement in Macro's sales conditions was mirrored at Mr Blundy's privately controlled retail chains under the umbrella group BB Retail. Brands in the group include the music retailer Sanity and the fashion and jewellery chains Bras N Things and Diva.

"We've seen an uplift from mid-July and it's happening at a greater pace by the week," Mr Cody said. "We seem to be defying the negativity."

Mr Cody admitted expansion plans for Macro Wholefoods had been on ice for the past eight months while the retailer implemented an automated inventory and ordering system, but he said that project was now complete and further store openings were back on the agenda.

"There is definitely an opportunity for 30 or 40 stores over the next four years, no question," he said.

"We're ready to go. It's just finding the right properties."

He said the company had shut down one store, in Concord in Sydney.

He also noted stiffer competition from the big supermarket chains Coles and Woolworths, which he said had significantly improved their organic and health offerings this year.

This would have a short-term effect on Macro's business but was ultimately a positive development because it educated consumers, who would then frequent his supermarkets.

"Coles, particularly, has done a better job integrating health and organic lines into their stores. We would prefer them to keep those products in a dark corner somewhere."

The economic downturn had been "a bit annoying for us because, if we'd had another year under our belt in the education process, we would be that much better off".

"We've got to educate people why it costs more to buy an organic chicken than a battery chicken. That said, our prices are coming down quite dramatically," he said.