Whole Foods Business Analysis

Whole Foods is a retailer that specializes in organic foods and it has done an excellent job of determining its target market and how to position itself. Instead of going head to head with large food retailers such as Wal-Mart, Whole Foods has found a niche market that works perfectly for itself. This niche market is one that prides itself on being health conscious and environmentally responsible and Whole Foods has done a great job of positioning itself in the same way through its environmentally safe actions and its use of the local community to stock its stores. However, as Whole Foods grows and expands, a person has to wonder if the company will be able to maintain this same position or will have to make

Whole Foods, just like any other retailer right now, has been struggling with the economy. The external environment has been changing in uphill and downhill motions daily, something that Whole Foods has never experienced before. Not only is there pressure on the financials of the corporation, but also there is the pressure to go green.

While the foods retail industry is highly competitive, Whole Foods has established a reputation and maintains a brand loyalty with its customers. Increased rivalry will occur in the larger grocery chains like Wal-Mart and Kroger, because of their flexibility in the products they can offer, and the pressures they can put on the sales growth and overall profits of Whole Foods. They have a larger cash and customer base, and the ability to better advertise their products, while Whole Foods still generates most of their

In technological factor and sociocultural factor, as grocery delivery should become a new trend, Whole Foods also respond to this by applying online grocery shopping even though they are a little slow responder compared to their competitors. Whole Foods appears to have the ideal customer base which can benefit from such a service as its shoppers tend to be high-income, urban, and willing to spend a few extra dollars to save time. This could benefit Whole Foods if they can figure the aggressive and effective way to develop this. The most successful new promotion may be its digital coupons, a program that was launched on January 28th. Daily downloads of the Whole Foods app jumped up to 5 times in the period after the coupons were introduced.

Whole Foods is a supermarket that has successfully become the leader in the organic food segment of the grocery industry. While traditional markets have low brand loyalty and recognition, Whole Foods has focused almost entirely on its brand image, causing their strategy to be one of differentiation over cost leadership. Whole Foods is known as being far more expensive than other chains, due to this brand recognition. In their press release for the Q4 2014 results, they describe their vision and sum up what helps them develop that brand recognition. “We hold the idea of “food” to a higher standard, banning more than 75 ingredients commonly found in other stores, and we believe our unparalleled quality standards

It’s a privately held company and one that withholds many of their details with the outside world. The evidence however indicates that the company is remarkably profitable. One of the key drivers of profitability in the food retailing industry is sales per square foot. Experts noted that Whole Foods Market had the highest sales per square foot of any publicly traded grocer in the country, and yet Trader Joe’s doubled the sales per square foot achieved by Whole Foods. All of the 414 Trader Joe’s stores (as of July 2013) are company operated. This allows them to maintain better control over their information systems, policies and procedures. While their locations may be small for the industry they are carefully chosen to match their target demographic which were described as people who dress their kids in tie-dye but have really good car seats. Trader Joe’s also minimized their marketing and sales expenses. With the exception of a few radio ads, Trader Joe’s was able to reinvest that money to further train their employees and emphasize service to the customers which has certainly paid strong

Whole Foods recent launch of their new stores, 365 by Whole Foods Market, is a way of trying to take a stab at Trader Joe’s niche. The one way Trader Joe’s has fought back was by lowering their prices. With other competitors joining the ranks of the organic food market, Trader Joe’s may be thinking ahead with other strategies, and may be in for a good fight as others want to duplicate their

In the merger and acquisition of Amazon and Whole Foods brings two different companies together into a cohesive business entity that complement each other. Separately these two companies commanded their own prices. Whole Foods market power was their ability to charge high prices for high-quality organic foods. Hence why they are also called “Whole Paycheck”. Amazon was a price leader in offering low prices.

The grocery industry is highly fragmented, with a multitude of strong regional players (Safeway, Publix, Kroeger, Wegmans, etc.). The largest grocery retailer in the United States is Wal-Mart, with an estimated 33% share. Other major retailers are targeting this segment of the industry, focused on a relatively narrow selection of key commodity foods at relatively low prices (Forbes, 2011). Whole Foods competes in a segment occupied by differentiated grocery players including Trader Joe's, Fresh Market and a highly fragmented selection of local and regional upscale and health-conscious grocery stores. The big players in the industry usually carry ranges of organic and natural products as well, siphoning off some business from Whole Foods. As Whole Foods grows, it comes into competition with mainstream grocery retailers more frequently (McLaughlin & Martin, 2009).

Some of the disadvantages that the merge of Amazon with Wholefoods brings are the fact that in order for the customer to get the Amazon Prime deal, the customer must buy the groceries online and can do a store pick up option, but doing this eliminates the need for a cashier. The cashier is now being replaced with the technology changes that Amazon is embracing. This can be a disadvantage to many cashiers in the future. Still with the Amazon Prime deal, Wholefoods is expensive compared to other grocery stores. Wholefoods has penetrated only in certain locations and if the prices stay expensive the grocery store won’t be able to penetrate in low or middle income neighborhoods.

Amazon-Whole Foods acquisition into the grocery business has created a lot of threats and competition to existing or major retailers (Wal-Mart and Kroger) of grocery products because they failed to effectively and efficiently integrate modern organizational and technological strategies in grocery and whole foods

Although April of 2017 saw reports of declining sales for the sixth quarter in a row, Amazon.com announced that they would purchase Whole Foods that June. The acquisition

I am not sure if Amazon is doing this with Wholefoods but Amazon could be taking the advantage of using personalization for groceries. When you shop on Amazon, the retailer keeps track of your purchases and helps you figure out what other things to purchase. Amazon can do this for groceries with Wholefoods. This way, they maximize profit by making recommendations of items that help the shopping experience. Using these resources and technologies will boost the companies’

Whole Foods Market began in 1970 as a local supermarket. Over the past 31 years, Whole Foods Market has grown from a single store in Austin, Texas, to becoming one of the worldwide leaders in providing consumers with natural and organic foods. They have grown to over 300 stores in both North America and the United Kingdom. (Whole Foods Market, Inc., 2011) This report examines the chief elements of the strategy that Whole Foods Market has put into place. Also, it uses past financial data to provide an assessment of the condition of the company going forward. Those assessments include recommendations of future actions, along with concerns I have about the way the company is currently operating and some difficulties that may be on the way.

The board of directors from Amazon.com is likely to take an approach of nominal participation with their executives. Whole Foods is a new acquisition for Amazon.com, but one that was already having great success. Bezos emplaced a company man at the helm of Amazon.com to make sure that the larger company interest was observed, and should to allow leading the way as a manufacturer and designer of an exceptional product.