Whole Foods Case Study Essay Sample

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The demand for organic food is presently at an all-time high, with sales growth of 20% each year. We can achieve profit growth at Whole Foods and maintain their social mission by creating a new private label product line which contains Organic and non-Organic products. Our social mission would have to have minor alterations to include the change, which will still have strong standards. This will capture the target market that feels organic food is expensive or will go to a competitor for more affordable pricing. Broadening and capturing our target market would lead to a profit gain of at least 10%. This will create capital to continue to expand the Whole Foods brand. Background

Whole Food is the largest organic food conglomerate, currently has over 260 stores in the US, and a growing presence in Canada and the UK. It is regarded as one of the fastest growing companies in the completive grocery market and topped the list in Forbes as “100 Best Companies to Work For.” Category:

Organic food sales growth has been calculated at 20% each year, quadrupling sales from $3.6 billions to $21.1 billion which has led to Whole Foods growth. Whole Food currently has over 275 stores and 52,900 employees. During this growth period, the USDA has formed the National Organic Standards. This created more stringent rules and regulation over all organic products, affecting all that grow and sell organic products. Consumer:

When Whole Foods began they created a Quality of Standard which included prohibiting foods with artificial coloring, flavors, sweeteners, Trans fats or hydrogenated oil. Whole Foods decided shortly thereafter that they wanted to compete with mainstream supermarkets, which is when the loyal consumers began to protest that they were no longer receiving the highest quality natural or organic food. Whole Food believes that the expanded selection opened the door to a broader consumer base. Competition:

Whole Foods has three sources of competition: lower cost alternate markets, farmer’s markets and conventional supermarkets such as Wal-Mart, Super Target, etc. Trader Joes is direct competition to Whole Foods. They remain profitable by providing their customers with low cost product using 80% of private labels. Issue:

Whole Foods needs growth of the corporation, which can be obtained by creating several private-label brands that cater to different areas of the world. (For example: 365:Italian). We can also make all our stores learning areas to expand on our consumer knowledge of what they are purchasing.

When Whole Foods expanded their selection to compete with the traditional supermarket, it opened the door to a broader consumer base. Adding new private label products to our current market will appeal to bargain hunters and people who are on tight budgets, which will generate profits yearly. By adding Non-Organic/Organic products to the social mission statement will inform the public and not mislead them. This will also allow one-stop shopping which will generate a buzz (word of mouth) for Whole Foods, saving gas and money. We will inform the public of the changes by television, social media, giveaways and the traditional newspaper.

There is risk associated with any plan execution. Competing with Trader Joes, Walmart, Target, farmer’s markets and local supermarkets create many challenges. Offering a new affordable product line will definitely attract new consumers and open up new doors for Whole Foods.

Next Step
The next step is to survey the competition to obtain information of what the consumers are currently buying then create a line of low prices private label products. Once created develop a test market to see how the products does.

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