MONEY's 1993 Store of the Year Riding the crest of eco-consciousness, Fresh Fields serves up ''good for you'' foods and products in snazzy supermarkets -- for only 5% more than you would pay for the ordinary stuff.
By Lani Luciano Reporter associate: Elif Sinanoglu

(MONEY Magazine) – Steer your cart down the immaculate aisles of Fresh Fields' new 30,000-square- foot market in Alexandria, Va. for the first time and, while everything looks familiar, you sense the landscape is subtly changed: Grape Nuts and V8 appear, but Coke and Doritos have vanished. Haagen-Dazs honey vanilla and Chewy Gooey brownie mix crowd the shelves along with 8,000 other products, but there's no Jell-O and nary an Oreo. Welcome to the latest in shopping for edibles: upscale health food sold in a supermarket setting. The local health food shop, where you scoop granola from a barrel, is giving way to New Age markets like Fresh Fields, the five-store chain near Washington, D.C. that is MONEY's 1993 Store of the Year. Fresh Fields' offerings -- ''Foods that are good for you,'' as the company motto puts it -- still include granola, now packaged in tidy boxes. But they also include thousands of ordinary supermarket items, such as oatmeal and ground beef (minus the sugar and chemicals, of course). The store stocks just-baked breads (sourdough, $2.09) and pastries, imported coffee beans (Costa Rican Blue Lagoon, $5.99), exotic cheeses (Toma di Carmagnola, $7.99), made-on- premises pasta ($3.59 to $4.99 a pound) and such status treats as golden raspberries ($2.99 a half-pint) -- all in an expansive, well-designed retail space. Fresh Fields is riding the crest of a mighty trend -- eating for health -- evidenced by the burgeoning number of natural foods stores across the country as well as by the growing shelf space given to such products at mainstream supermarkets. In a June survey by HealthFocus, an Emmaus, Pa. research firm that tracks consumer attitudes, 90% of shoppers say health is now a factor in the food they buy. Before 1980, that concern was too small to track. Although scientists still argue about exactly what constitutes a healthful diet, the natural foods industry has jumped from $2.4 billion in 1982 to nearly $5 billion today -- equal to last year's total movie box office receipts. Purchases of natural foods have an average growth rate of almost 10% a year since 1986, ringing up robust profits even during the recession, compared with just 4.3% annual growth for the $376 billion grocery store business as a whole. Such numbers prove that many Americans are now willing to pay as much as 20% more for natural foods, the average premium at most health food shops. Thanks to large sales volumes, however, the good-for-you premium at Fresh Fields is only 5% or so. What's more, locally grown organic produce in season at Fresh Fields may cost even less than in-season nonorganic produce at nearby supermarkets, while organic produce at local markets tends to run 25% to 30% more than those stores' nonorganic fruits and vegetables. On some products at Fresh Fields, the premium can balloon. For example, talc-free baby powder will set you back $4.75 for four ounces. But parents need spend only 50 cents for a six-ounce jar of Beechnut Special Harvest or Earth's Best organic baby food -- no more than for nonorganic brands. As for the basics: Fresh-baked multigrain bread packaged in a plastic bag is only $2.79 for a 26-ounce loaf. And Fresh Fields charges $1.33 for a half-gallon of certified hormone-free low-fat milk while a half-gallon of low-fat milk at other area stores is $1.49. For gourmet goodies, Fresh Fields prices are comparable to other fancy food shops: Goat cheese, for example, costs up to $16.99 a pound, and chanterelle mushrooms go for approximately $15 a pound. What happened since the macrobiotic '60s to push natural foods upmarket? Dramatic shifts in attitudes, particularly among high earners: -- Concern about the environment. Following ecological disasters, such as the 1986 Chernobyl nuclear accident and the 1989 Exxon Valdez oil spill, and after food-chain scares such as fish poisoned by mercury, and chickens and eggs contaminated with salmonella, foods free of chemicals are widely regarded as better for people as well as for the planet. -- Greater consumer awareness. As health concerns have grown, shoppers are demanding better ingredient labeling and nutrition information on packages. They're reading it too, according to Monica Arnold at the Boulder-based Natural Foods Merchandiser, particularly since the 1989 brouhaha about Alar, a suspected carcinogen that was sprayed on apples to regulate growth. Consumers are also more conscious of additives and fat, sugar and salt content these days. Fresh Fields was started only 19 months ago by three entrepreneurs -- CEO and president Mark Ordan, 33, a former Goldman Sachs investment banker; chairman Leo Kahn, 75, a founder of Staples, the booming office-supply stores; and chief operating officer Jack Murphy, 44, a former manager at the Heartland supermarket chain in New England. But the privately held firm has already posted revenues of $50 million. The five Fresh Fields stores are set in some of the country's most affluent suburbs: Rockville and Bethesda, Md., and Tyson's Corner, Alexandria and Charlottesville, Va. Three additional outlets, in Richmond and Fairfax, Va. and in Annapolis, Md., are scheduled to open in the spring of 1993. And in 1994, the company expects to launch stores in Chicago and Philadelphia, while New York City may follow. ''Fresh Fields,'' says Chris Kilham, president of Cowboy Marketing, a consulting group for the natural foods industry, ''is aimed at the brains-and- money crowd, people who can afford informed choices but don't necessarily want a new way of life.'' As a result, the chain has a shorter list of no-no's than most health food stores. Among its rules: no foods with refined sugars or synthetic preservatives and no hydrogenated oils, bleached flours or meats from animals grown with hormones or antibiotics (see the box on page 107). Indeed, what distinguishes Fresh Fields from more established competitors, such as Mrs. Gooch's in Southern California, Bread & Circus in Massachusetts or Alfalfa's in Colorado, is a deliberate lack of missionary zeal. Notes Mark Ordan: ''We don't tell people how they should eat.'' For example, there's just as much nonorganic produce as organic in each store. And, similarly, ice cream fanciers may choose between Rice Dream, a lower-fat, no-cholesterol, 130-calories-per-serving frozen dessert made from milled rice ($2.29 a pint), and the high-fat, high-cholesterol, 250-calories- per-serving real thing in Haagen-Dazs honey vanilla, albeit sugar-free ($2.99). Fresh Fields customers also tend to be ecology-minded. ''People concerned about what goes into their bodies are also concerned about what goes into the earth,'' points out Linda Gilbert, president of HealthFocus. Thus shoppers at Fresh Fields can buy their whole grains in five-pound bulk. Environmentalists gravitate to the nonfood departments where recycled paper goods and nonpolluting soap powders are sold. Also available: cosmetics that are not only all natural but ''cruelty-free,'' meaning they are not tested on animals. Although Fresh Fields doesn't endorse any specific diet or regimen, they go to great lengths to educate customers. Before hitting the selling floor, most employees undergo two days of training. In addition, dozens of pamphlets with titles such as Beans, Water and Grains are liberally distributed. ''Approximately 18 million pounds of antibiotics are administered to livestock each year,'' notes the meat pamphlet, for instance; it then outlines Fresh Fields' procedures for buying drug-free meat. Besides offering conventional sales and coupons, Fresh Fields lures buyers with copious free samples of its products. An employee in the produce section may serve slices of organic apples while another in the deli department dishes out organic potato salad. And in Alexandria recently, the pizza bar presented shoppers with slivers of pie made from organic, unbleached flour. The strategy seems to be working, at least on Merri Mukai, an Annandale, Va. homemaker who first tried Fresh Fields at the Tyson's Corner branch last February. Says Mukai, 40, whose family includes attorney husband Robert, 41, and sons Jonathan, 8, and Thomas, 3: ''Originally, I bought organic produce and spent $25 to $30 every week or two. Then I tried the baked goods and upped my spending by $60. Now I'm buying meats and eyeing the fish. They've definitely got me hooked.''