Introduction Whole Foods Market was founded in 1978 by John Mackey and his girlfriend at the time, Rene Lawson. The store, at that time, was called SaferWay and they lived above the store (Smith, 2005). In 1980, the company merged with Clarksville Natural Grocery creating the first Whole Foods Market. Unfortunately, in that first year the company was hit with the worst flood Austin had seen in 70 years destroying inventory and equipment, essentially wiping the company out. Luckily, the community helped rebuild the store and creditors along with vendors helped the company get back on their feet which allowed them to strive and grow to what they are today (Whole Foods, n.d.). Whole Foods quickly gained the support of the community, which allowed them to grow in the Texas market and push into new territories over the next few years. Today, Whole Foods is a publicly traded company on the NASDAQ under WFM. The company began on the NASDAQ as WFMI (Hoffer, 2011) on January 23, 1992 (Whole Foods, n.d.). The founder John Mackey and Walter Robb are Co-Chief Executive Officers of Whole Foods Market. John is a college dropout who studied philosophy and religion who helped start the company and had no experience in grocery retail (Arlidge, 2006). Walter is a graduate from Stanford University with a …show more content…
When looking at their website, Whole Foods Market History “Pieces of the Whole,” they list a total of 14 companies (n.d). Companies that are doing well may merge or be acquired, but it is not always common place. When looking at the acquisition of Wild Oats Markets, the company paid off $700 million of term debt held by Wild Oats (Whole Foods, 2012). Whole Foods net income increased by 36% giving them $465 Million in 2012. Companies have to balance price with cost in any industry, especially where prices are much higher than their substitute products. They cannot directly compete unless it is in their strategic
In order to right the ship that is America’s food industry, we need to recognize the monopolies in the U.S food industry. These massive food conglomerates must be broken up in order to create competition in the market. This will allow the completion to dictate the market. More companies means more competition, and when companies compete, the consumer wins.
The food market business is usually a difficult one, but online retailer Amazon's proceeding to purchase high-end chain Whole Foods changed the landscape. The new corporation is currently reducing prices, as well as Amazon is managing to reduce costs by taking its online expertise
Whole Foods Market allows each market to supply products that are standardized, and also supply products based on local buyer needs, as well as the culture of the area; therefore their business strategy is transnational (Thompson, 2016, p. 192). Whole Foods Market varies their products based on location, focusing on local products and any unique products to promote a neighborhood market feel for their customers. The company strategically chooses its locations, placing them in educated areas, and then focuses on products to sustain a competitive advantage.
The threat of new entry for the industry is low, as considered by high costs and intense price competition, which make the industry’s profit margins very low. In the United States the market is concentrated, where the 50 top firms, including: Wal-mart, Kroger, Safeway
Steve Oliver Maass purchased a grocery store that was in bankruptcy back in 1988, in Cotati, CA, mortgaging his house to come up with the payment of $200,000. Although he had no grocery store experience besides working in the produce department of one, he felt he could not do any worse than the previous owner did. The store was run down and a mess requiring a lot of cleaning. With limited funds, he was only able to paint instead of doing much remodeling, as he wanted to do. Maass renamed the store Oliver’s Market after his middle name, and he and his wife worked the store for the first four years. During those years, Oliver’s added a Service deli and a Health foods section. Following the format of Whole Foods, Oliver’s carried a section of organic health foods and included conventional items as well.
Not many companies have the same track record and this proves that Whole Foods is in it not only for
Thirdly, there are areas both domestic and abroad relatively untouched by Wal*Mart: large cities. Though it may seem like untapped potential in these markets, it is not recommended to expand in these highly populated areas. The axiom, “If it ain’t broke, don’t fix it,” applies: If Wal*Mart were to do an about-face and start expanding in this form, it would send mixed signals about not only changes in the corporate strategy, but also about the future of this conglomeration of stores. This is especially poignant at this volatile time in the price of their stocks. They should also be extremely cautious in the acquisition of existing discount retailing companies. As the industry becomes more concentrated, Wal*Mart’s selectivity in large acquisitions extends beyond just profits. Many times, Wal*Mart could better spend their resources by improving existing stores or building new ones because they can build them around their ideologies at a much lower cost than through purchasing other companies. Again, this is not to say they should not expand in this manner, just that they need to be extremely selective when doing so.
Kmart was the largest retail discount with competitors such as Wal-Mart continually increasing their profit, Kmart's market share has dwindled to 13% and continues to decline. Wal-Mart's early use of IT within the industry was a major factor to Wal-Mart rise about Kmart and the fall of this once mammoth retail chain. Wal-mart was the first within the industry to operate on a large-scale format, operate a computerized inventory system, use bar codes and wireless scanners, allow electronic data interchange with suppliers, and expand around central distribution centers.
Sainsbury’s entered a joint venture with British Home Stores in 1971 to create hypermarket style stores under the brand SavaCentre. These stores reverted to the standard Sainsbury’s brand and superstore format in 1999.
Founder John Mackey strongly believed in Whole Foods’ mission to be very selective about store inventory, sticking to the company’s core values and ensuring that customers had an enjoyable and interactive shopping experience, while keeping with planned strategies that have set them apart from their competitors.
Colvin, G. (2013, May 20). Walter Robb: Whole Foods' other CEO on organic growth. Fortune Magazine. Retrieved from http://money.cnn.com/2013/05/06/leadership/whole-foods-robb-ceo.pr.fortune/
To most consumers Whole Foods is known as a chain grocery store specializing in organic and natural foods. Some may go as far as say the name is synonymous with quality. This comparison is the result of Whole Foods’ marketing their brand successfully to consumers demanding their specialized foods. As with any organization, Whole Foods may consider evaluating their strategic objectives and decide if necessary course corrections are needed to reach their objectives and goals. Through a fundamental and technical analysis, I will discuss Whole Foods’ mission, vision, and goals, their competitive environment, and some factors within their strength, weakness, opportunity, and threat analysis. With such data and information I will recommend, if needed, and strategic changes in order to sustain a competitive advantage.
Whole Foods Market, which is in the Grocery Store and Health Food Store industry, is one of America’s most prominent organic grocery store on the market. The supermarket chain has established a competitive advantage amongst other grocery stores, as it assures consumers that all foods are free of preservative, additive, and pesticides. The grocery store has gained such a profitable following, that it Amazon acquired it in August 2017, boosting Whole Foods Market’s digital and physical competitive advantage. In fact, most researchers have concluded that such an acquisition may eliminate any opportunity for other grocery store chains to compete against Whole Foods Market (Formichelli, 2017). Whole Foods Market’s key to success
In order to compete they would have to be able to price match their products and provide the wide array of consumer services like Best Buy. With over 1,700 stores in the U.S. this allows the consumer easy store access with product and employee interaction of which manifest the loyal returning consumer. These factors in combination would entail a vast amount of working capital from the start along with experienced employees and therefore detouring new
...Mackey were/are two of the most innovative pioneers of our time. Although Walton didn’t invent discounting, he was just the one to put it into action. His idea was not one that he thought of overnight, it was a combination of all his competitors’ mistakes that he studied in detail. Moreover, he was also a pioneer in his belief in employees. He believed that the workers that were interactive with the customers had the most knowledge of what the company ought to do. Same as Walton, John Mackey didn’t invent organic foods, but he created a grocery that ensured consumers of what they were purchasing. He prided himself in selling top quality organic, unprocessed foods to the public. In addition, Whole Foods set the standard of humane treatment of animals. These two men have been remarkable in their impact on society and have paved the way for up and coming entrepreneurs.