COMPANY BACKGROUND

Whole Foods Market was founded in Austin, Texas, when four local businesspeople decided the natural foods industry was ready for a supermarket format. Their founders were John Mackey and Renee Lawson Hardy, owners of Safer Way Natural Foods, and Craig Weller and Mark Skiles, owners of Clarksville Natural Grocery. The original Whole Foods Market opened in 1980 with a staff of only 19 people. It was an immediate success. At the time, there were less than half a dozen natural food supermarkets in the United States. It has grown in leaps and bounds since then. Today, they are the worlds leader in natural and organic foods, with more than 310 stores in the North America and the United Kingdom (About Whole Foods Market). During its 31-year history, Whole Foods Market has been a leader in the natural and organic food movement across the United States, helping the industry gain acceptance among growing numbers of consumer concerned about the food they eat (Thompson, Strickland, & Gamble, 2010, p.C-2). The company seeks out the finest natural and organic foods available, maintains the strictest quality standards in the industry, and has an unshakeable commitment to sustainable agriculture. Add that to the excitement and fun they bring to shopping for groceries, and you start to get a sense of what they are all about.

John Mackey, the companys cofounder and CEO, believes that Whole Foods rapid growth and market success has much to do with its having remained a uniquely mission-driven companyhighly selective about what we sell, dedicated to our core values and stringent quality standards and committed to sustainable agriculture (Thompson, et al., 2010, p.C-2). Mackeys vision was for Whole Foods to become an international brand synonymous not just with natural and organic foods but also with being the best food retailer in every community in which Whole Foods stores were located. He wanted Whole Foods Market to set the standard for excellence in food retailing. Mackeys philosophy was that marketing high-quality natural and organic foods to more and more communities would over time gradually transform the diets of individuals in a manner that would help them live longer, healthier, more pleasurable lives. They often talk of their mission in terms of Whole Foods, Whole People, Whole Planet.

Whole Foods: This means that the company searches for the highest quality, least

processed, most flavorful and natural foods possible because they believe that food in its purest stateunadulterated by artificial additives, sweeteners, colorings and preservativesis the best tasting and most nutritious food there is.

Whole People: They see people as their company. Their employees are passionate about

healthy food and a healthy planet. Employees also take full advantage of Whole Foods decentralized, self-directed team culture and create a respectful workplace where people are treated fairly and are highly motivated to succeed.

Whole Planet: The company is committed to helping take care of the world around us, and their active support of organic farming and sustainable agriculture helps protect the planet. And while they assist global neighbors through their Whole Planet Foundation micro-lending operations, they also step out the back door of each store to support food banks, sponsor neighborhood events and donate to local non-profit groups (About Whole Foods Market).

The following list of core values reflects what is truly important to Whole Foods as an organization. These are not values that change from time to time, situation to situation to person to person, but rather they are the underpinning of their company culture. Many people feel Whole Foods Market is an exciting company to be a part of and a very special place to work. By maintaining these core values, regardless of how large a company Whole Foods Market becomes, the company feels they can preserve what has always been special and unique to their atmosphere. The following is a list of their core values (Our Core Values):

Selling the highest quality natural and organic products available

Satisfying and Delighting their customers

Supporting team member happiness and excellence

Creating wealth through profits and growth

Caring about their communities and the environment

Creating ongoing win-win partnerships with their suppliers

Promoting the health of their stakeholders through health eating education

HIGHLIGHTS ON WHOLE FOODS

In February 2007 Whole Foods acquired its largest competitor at the time. Whole Foods signed a definitive merger agreement with Wild Oats Markets. Whole Foods would acquire Wild Oats Markets outstanding common stock in a cash tender offer of $18.50 per share. Whole Foods spent $565 million for the merger and had to pay off Wild Oats debt of $106 million. This merger allowed for Whole Foods to increase its operations to over 300 locations and operate in 30 states. Whole Foods also acquired stores in Canada and in the United Kingdom, allowing them to further expand their company internationally. At the time Wild Oats was operating 110 stores with annual sales of $1.2 billion compared to Whole Foods who had 193 stores and net sales of $5.6 billion.

The merger worked out both for Whole Foods and for Wild Oats. Wild Oats was underperforming and was in transition period of operating without a CEO or CFO. Both of these situations are signs of a needed change. John Mackey, Whole Foods CEO, called the acquisition highly opportunistic. Mackey went on to say the timing was right to approach Wild Oats about a merger given the strategic gap at Wild Oats as evidence by the lack of a CEO and lack of a clear company vision (Whole Foods Acquires Wild Oats).

One of the biggest challenges that Whole Foods faces is its inability to open new locations. By merging with Wild Oats, Whole Foods has a stronger presence in the Rocky Mountains, Pacific Northwest, and Florida. These new acquired stores allows for Whole Foods to have new locations. It also gives Whole Foods the benefit of operating in these three regions; these three regions were where Whole Foods lacked presence. Now that Whole Foods is able to have a better presence in these regions it will allow for Whole Foods to continue increasing the amount of stores Whole Foods has.

Another important event that happened to Whole Foods was in 2001. Whole foods acquired most of Harrys Farmers Market Inc.s assets for $35 million. Whole Foods at the time had current assets totaling $144.7 million. This acquisition increased Whole Foods total assets by about 24%, a very significant increase (Whole Foods Market Acquires Harrys Farmers Market Stores). Whole Foods received three perishable superstores, a distribution center, commissary kitchen, a bake house, and office facilities. This acquisition in 2001 allowed Whole Foods the opportunity to continue increasing its company. This acquisition gave Whole Foods presence in Georgia by having stores, a distribution center, a bake house, and office facilities. This allows Whole Foods to be able to operate in the southern United States and continue supplying and opening new stores. WHAT SHOULD HAVE SPECIAL EMPHASIS

After researching the industry and Whole Foods as a company the area that should have special emphasis would be the opportunity to continue increasing. With todays views and motivations, consumers are looking for products and changes that will allow for them to become more environmentally friendly. This is an ongoing view that many consumers are following. Companies, like Whole foods, need to continue to increase their product line, open new stores, increase awareness, and continue increasing internationally. A company that is viewed by consumers as an environmentally friendly place and has the best nutritional products has a great opportunity to be successful. Whole Foods cannot afford to let its competitors or larger companies, such as Wal-Mart or Kroger, to get a step ahead in this industry. Whole Foods needs to be the leader and not the follower. Going green is an international motto that many consumers and countries are trying to move towards. Companies that can reflect this motto give their consumers more confidence in purchasing their products. WHOLE FOODS MARKET IN 2008 CASE STUDY QUESTIONS1) Strategic Market Condition-

Whole Foods has become the worlds largest retail chain of natural and organic foods supermarkets. Not only is their focus to transform the way consumers look at food and its natural benefits, Whole Foods is looking to make a difference in the world with their products. This idea is portrayed through their motto, Whole Food, Whole People, Whole World. Since emerging into the retail market in 1991, Whole Foods has continued to push through the skepticism and hardships to emerge as one of the leaders in natural and organic food retail. Currently, Whole Foods appears to be in a rapidly growing market. Whole Foods has worked hard to set their products apart from other grocery retail chains and while their prices might still be considered high across the board, their products are geared towards a more health conscious individual who is willing to pay more for a healthier product. Through their acquisition of Wild Oats Market and new Whole Foods stores popping up everywhere, especially in metropolitan areas, Whole Foods have been hard at work to make themselves present in the food retail industry.

In order to compete in this market, Whole Foods will have to stay true to their roots as far as only offering natural and organic foods. Many grocery chains have ignored the growing demands of consumers for healthier foods over the years, and Whole Foods has to capitalize on these increasing demands. While their prices are higher, the lifestyles of consumers are changing to one which is more health conscious and many consumers have said theyre willing to pay more for a healthier product. With this recent shift in consumer lifestyles, Whole Foods is one step ahead of many of the other grocery retailers in the industry and this gives them the competitive edge they need to stay a leader in the market. Whole Foods needs to increase the number of stores that they have throughout the country and work on expanding their product line to as many natural and organic products as they can manage within their stores. Many grocery retail stores such as Krogers and Giant Eagle have noticed the trends in consumer demands changing rapidly and are working hard to adapt the natural and organic lines of food within their stores, but they are just emerging into the market. Whole Foods will need to stay ahead of their competitors when it comes to the products they offer and establish a strong consumer base. With these other retailers jumping onto the natural and organic bandwagon, the prices of these products will begin decreasing and consumers will have more options as to where to shop and get the same products, so Whole Foods must work hard now while theyre growing to attract a steady customer backing so when this market hits its mature stage, which it will once all of these other retailers establish a natural and organic brand of their own, Whole Foods doesnt have to focus on attracting customers to keep their head above water. Instead, they can look ahead to what is next for Whole Foods in their expansion of stores and product line.

2) Chief Elements of Strategy and Generic Strategy Employing-

After looking through the Whole Foods Case and taking a more in depth approach at evaluating their operations, competitors, and market as a whole, it appears that Whole Foods is operating under a focused differentiation competitive strategy. Some of the reasons for thinking this are

A narrow market niche where buyers needs and preferences are distinctively different

The market that Whole Foods is going after with their product line is specifically those

consumers who are looking for organic/natural foods. They only sell these types of

items which allows them to focus solely on the needs and demands of this small market group. Attributes that appeal specifically to the tastes and requirements of niche members

Unlike their competitors, Whole Foods sells strictly natural and organic products that meet the desires of the developing organic market. They arent worried about attracting all grocery consumers to their store by offering a wide variety of food products; they focus on organic and natural foods only.

Features and attributes tailored to the tastes and requirements of niche members

Because Whole Foods only offers organic and natural food product lines, they are meeting the growing demands of the consumer market which has begun the shift towards organic and

healthier foods. Since theyre offering the specific products that not many of their competitors are offering, Whole Foods is able to charge a higher price that consumers are still willing to pay because the demand for the product is so high while the supply is so low. Stay committed to serving the niche better than rivals; dont blur the firms image by entering other market segments or adding other products to widen market appeal

Even though Whole Foods has gone about acquiring other companies and making business deals and propositions to better their company as a whole, Whole Foods has shown no interest in

entering any other market segments besides that of the natural and organic food line. They want to stay focused and committed to offering their consumers the highest quality product while continuing to try and lower prices and make other consumers aware of the benefits of eating healthier foods such as the ones sold at Whole Foods.

3) Well Matched Strategy

The strategy that Whole Foods has put into action is one of making change happen throughout the world, in all of the places that they are able to establish a store location. While their strategy does revolve around making a profit, their overall strategy is about creating a healthier world, through what consumers are eating and how our decisions are affecting the world. Right now, the natural and organic food segment of the food retailing industry is in a period of growth and change which really creates a great match between Whole Foods and the industry segment itself. Although Whole Foods has been around for a while, because they are distributing a product that very few consumers are demanding, they are just now reaching a point of rapid growth as an organization. With the go green and be healthy society pressures that are really becoming strong forces in day to day life, the organic and natural food segment is really beginning to take off. Both the strategy and the segment that Whole Foods is in are experiencing a time of rapid developments, high numbers of competitors trying to enter into the market, and growing consumer demand which makes they strategy they are currently employing a great fit to the current conditions they are facing within the industry.4) SWOT Analysis

When looking at Whole Foods and their industry, the true driving force at work is the growing demand of a small target niche desiring organic and natural food products. Organic and natural products have been around for quite some time however they were considered a high-end food product due to the simple fact that they are more expensive than normal food and produce. This growing demand is going to benefit the competitive structure favorably because it will create more competitive energy and dynamics within the organic/natural segment. A SWOT Analysis of Whole Foods shows that they are currently in a very stable place due to their strong brand name, broad product knowledge, and high employee satisfaction. Whole Foods has ample opportunities with minimal and controllable threats and weaknesses. The following SWOT Analysis information shows the top points in each of the sections within the SWOT and the full SWOT Analysis conducted can be found in Figure ().Strengths

Broad product offerings wide selection/variety with over 30,000 items offered. Nationally known as organic/natural food seller The environmental protection agency of United States has given it third place at the list of its 25 green power partners (Whole Foods SWOT Analysis) High employee retention no unions, above average hourly salary, solid benefits, 401K for workersWeaknesses

Higher priced products

75% higher priced products compared equivalent non-organic productsOpportunities

Increase demand for organic products

Hype right now is to eat healthier and protect the environmentGo Green movement continues to increase within societyThreats

Intense competition may have adverse effect on profitability

Large competitors are adapting Go Green movement as well (Wal-Mart, Kroger, and Costco)

Local farmers markets/independent retail chains can offer same products and offer lower prices without going through the manufacturer5) John Mackeys Strategic Vision

Whole Foods has a strong foundation on the words of their leader (CEO) John Mackey who initially wanted to open and develop Whole Foods into not only the best food retailer (in which Whole Foods was located), but to change the diets of individuals to help them live longer and healthier lives. Mackey developed the core values that employees of the Whole Foods organization follow each and every day and emphasized the importance of recognizing their ultimate goal, Whole Foods, Whole People, Whole Planet. Mackey had a great strategic vision for Whole Foods because he wasnt narrowing his focus on the financial success of the company; he was genuinely looking out for the well-being of his potential consumer base which should be at the core of every retailer out there. When you look at Whole Foods motto, Whole Foods, Whole People, Whole World, it creates a huge window of opportunities for the future of the company. This motto focuses on the three core elements that can make any business successful, by focusing on the product, consumers, and expansion opportunities. What we like about this motto is that it is short and sweet but yet packs so much meaning to the operations of the company. Whole Foods doesnt just use this motto to make themselves look or sound pretty, they run their company based on the words and principles associated with each of these six words. For Whole Foods, their motto is more than just a pledge to the industry about what to expect from their operations, it is a promise to employees and consumers that Whole Foods will not be satisfied until they are able to provide healthy food to everyone, everywhere.6) Do Core Values Really Matter?

When you look at the list of core values for Whole Foods, it is easy to see how vital each and every one of them is to the company as a whole. Before diving into explaining what exactly their core values are, Whole Foods takes the time to explain exactly what role the core values have to their organization. They say, The following list of core values reflects what is truly important to us as an organization. These are not values that change from time to time, situation to situation or person to person, but rather they are the underpinning of our company culture. Many people feel Whole Foods Market is an exciting company of which to be a part and a very special place to work. These core values are the primary reasons for this feeling, and they transcend our size and our growth rate. By maintaining these core values, regardless of how large a company Whole Foods Market becomes, we can preserve what has always been special about our company. These core values are the soul of our company. (WHOLE FOODS WEBSITE) The core values that Whole Foods proudly displays throughout their stores and websites are not just an accessory to try and gain consumer appeal; they are the backbone of every decision and operation that take place within the company. It is easy to see that Whole Foods core values contributed to the companys success because they lay out what steps it takes not only for Whole Foods to be successful within the industry (from picking out the right product to reaching out to consumers) but also how to be successful in the communities and environment that they are operating in. By essentially developing the guidelines for how a company should be run through the core values, Whole Foods was able to develop a strategic guideline for management and all of their employees to follow in order to promote competitive success.7) Whole Foods Financial Performance

*use slide show values*8) Whole Foods Strategic Performance

From a strategic perspective, Whole Foods is on the fast track to a very successful company within the organic retail industry. Whole Foods strategy is a restatement of their company motto, Whole Foods, Whole People, Whole Planet and they measure their strategic success through customer satisfaction, team member happiness, return on capital, and their ability to improve the current condition of the environment around them. The strategy of Whole Foods targets each of their competitive advantage opportunities within the organic industry. Because they are one of the first and biggest retailers in the organic industry, it is important that they capitalize on the growing consumer market while also staying true to their initial goals of creating an overall healthier environment. The company does have a winning strategy because it allows them to be successful in more than one area. Whole Foods has spread out their operations to not only providing the best product to their consumers, they are also trying to raise awareness to healthier eating habits while trying to promote and support the go green initiative. While some say that their strategy is too open ended and not focused enough on the future of the organization, it is hard to really establish a set in stone strategy for the market and industry that Whole Foods finds themselves in. The organic market is rapidly emerging into the grocery retail industry, and Whole Foods is riding the exciting wave as organic products become more popular amongst consumers. The strategy that Whole Foods is following is a great strategy for them because it allows them to focus on the product, the people, and the environment which is what Mackey wanted from the beginning while creating room for future successes.9) Weighted Competitive Strength Analysis

When you look at a competitive strength analysis of Whole Foods and their closest competitors, Whole Foods has a competitive advantage within the industry. The key success factors that were looked at in this analysis were overall size of stores, price of products, organic knowledge, reputation/image, customer loyalty/retention, variety of organic products, and distribution capabilities. Whole Foods has a competitive advantage amongst their competitors in organic knowledge and variety of organic products. When you look at the competitive strength analysis, youll see that Whole Foods is followed very closely behind by Trader Joes (who is second in each of Whole Foods competitive strengths). While these two competitors are close in their competitive strengths, Whole Foods has a slightly higher advantage over Trader Joes due to their store sizes and store locations. When you talk about organic retail stores, many people have never heard of Trader Joes due to lack of expansion with their stores which is where Whole Foods has been able to capitalize on becoming the leader within the industry. In order to maintain this advantage, Whole Foods really needs to focus on lowering their product prices. Many people consider organic foods to be a specialty or high-end item because they assume it is going to be so much more expensive, but if Whole Foods is able to continue offering such a wide range of knowledge and products in such a vast amount of locations at a lower price, they will have no problem maintaining their competitive advantage within the organic products industry.10) Acquiring Wild Oats Market

Ultimately by acquiring Wild Oats Market, Whole Foods was able to buy out their largest competitor. The acquisition process didnt go smoothly at first because many people feared that if Whole Foods was able to buy Wild Oats Market, it could lead to a monopolization of the organic industry however through much controversy, Whole Foods was able to acquire Wild Oats Market in late August 2007 (CASE IN BOOK). With this acquisition, Whole Foods was able to enter a large number of new consumer market areas as well as expand their product purchasing power which as a result majorly boosted their sales. Whole Foods was really able to spread their name throughout the country with this acquisition because they were entering areas that already had an organic consumer target market, and then by satisfying the consumers needs, good word began to spread about this up and coming company. Unfortunately with all of the success came some disappointing realizations. The biggest negative that came from the acquisition of Wild Oats Market was the debt that came with the company. Whole Foods was blindsided by all of the money that Wild Oats Market owed many suppliers, businesses, banks, etc. and because of this, their financials took a major hit themselves. Even though Whole Foods was now able to enter into all of these new areas to sell their product, any extra revenue that they were making and then some was going towards paying off their newly acquired debt. When it comes down to the acquisition of Wild Oats Market you really have to weigh your pros and cons because there were definitely some strong support factors for each side and through the information in the case and that we found researching into the company, we dont approve of the acquisition of Wild Oats Market. Even though they were able to quickly expand their operations into new regions and introduce their organization to new consumer markets, the acquisition cost Whole Foods more than what they gained. Whole Foods had a strong enough strategy that they didnt need to acquire another company; this decision seems to be a rash decision that wasnt thoroughly thought out in hopes of quickly gaining overall an overall competitive advantage within the industry. Considering the amount of money not only that Whole Foods paid to acquire Wild Oats Market, but the amount it took to relieve all the bad debts that came with the acquisition, Whole Foods came out on the short end of the stick with this deal.11) John Mackeys Internet Postings

John Mackey found himself in some hot water when it came to his Yahoo! and blogging posts that he did in regards to Wild Oats Market and the FTCs investigation into the acquisition of Wild Oats Market by Whole Foods. While it would be easy to jump to the conclusion that these actions were borderline unethical but through the facts, Mackeys actions appear to be more inappropriate and unprofessional than anything else. The first of Mackeys internet postings was a seven year span where he posted over a thousand entries on the Yahoo Finance site promoting Whole Foods and at times making comments about fellow competitor Wild Oats Market. These postings were made under an alias name, Rahedeb in order to try and hide his true identity (Case in Book). When confronted about his anonymous postings, Mackey said, I posted on Yahoo! under a pseudonym because I had fun doing it. I never intended for any of those postings to be identified with me (Case from book). From what was uncovered in the situation, it doesnt appear that Mackey was intending to destroy the company or run them into the ground; he was simply pulling the strings of a competitor to see what would happen. The second controversy that Mackey found himself in was over a blog he posted on the Whole Foods website showing complete disgust with the way the FTC was interfering with the Whole Foods acquisition of Wild Oats Market. In this situation again, Mackey was voicing his opinion over a matter that had direct effect on the company he had put his heart into and Mackey simply took it too far. Critics of the Mackey blog posting said, it was inappropriate for a CEO to publicly air the companys position on the matter (Case in Book). All in all, Mackeys actions were inappropriate for the leader of any organization, but they were simply actions of voicing his opinion which keeps them from becoming unethical. These incidents took place a few years ago, and at the time they occurred the Board of Directors for Whole Foods investigated Mackeys actions and complied with all requests from the FTC and court systems in the investigations. The board really has no need to take any further action on these past events, they simply need to ensure that everyone is on the same page and that something like this doesnt happen again.12) Any Other Issues Whole Foods Management Should Address

A future challenge that Whole Foods is likely to face is that conventional grocery stores will begin to over saturate the market and offer organic and natural foods. Whole Foods will face the burden of convincing new customers to shop at their store instead of other more convenient stores. Whole Foods will also have to be able to compete against the conventional grocery chains when it comes to pricing. Whole Foods product line is often seen as more expensive than the conventional grocery chain. Whole Foods has to decide whether they want to convince their consumer that the product that they are receive is worth the price that they pay, or Whole Foods has to figure out a way to lower the cost of the goods they offer. Another big challenge for Whole Foods is simply getting people in the door and maintaining a loyal customer base.13) Recommendations to John Mackey

We recommend that John Mackey stays proactive in the industry, instead of reactive. The best bet to continue to stay successful with Whole Foods is to stay one step ahead of the competition. This can attributed to in many ways. Revenue growth can be spurred through a marketing campaign and community outreach. Investing in advertising can really help spread the Whole Foods brand name and what they are really all about. The same is true for reaching out to the community; the company has a better chance that the Whole Foods brand becomes a more household name and attracts new customers. Retaining and increasing the customer loyal is going to be one of the most important things for John Mackey to focus on. One recommendation would be to create a customer loyalty card that provides discounts and incentives for people to come and purchase goods from Whole Foods. Its difficult to compete with the conventional grocery stores but costs can be controlled through reductions in direct labor, using buyer power to push down cost of goods sold, and reducing capital cost growth. Net income may not grow as much as Whole Foods might like, but the company can easily still remain profitable and continue to grow.RECOMMENDATIONS

Some financial recommendations for Whole Foods would be to grow net income, cut cost, increase revenue, reduce capital expenditures, and raise capital through equity shares and reduced borrowing. The impact of the recession requires that Whole Foods takes an action of conservative growth. This will help stabilize their net income profits. They could open fewer stores at the moment and reduce the average square footage of each store. Whole Foods really has no influence on deflating factors but they have some influence over cost, so as a company you need to be aware of the factors that you are in control of that will help the company increase net income. Deflating prices provide opportunity to negotiate lower prices and rates with suppliers and landlords. Whole Foods needs to use their buying power to pressure suppliers and negotiate for lower wholesale prices. These savings will reduce supply chain costs and costs of goods sold. Whole Foods could also scale back by closing unprofitable stores, reuse equipment, and/or terminate leases. They could raise capital by selling shares of common stock then use that capital for new store purchases. Equity capital will avoid debt through banking institutions.

Another way for Whole Foods to prosper is to expand a little more on their marketing strategy. First of all they should increase the marketing budget. They should reaffirm Whole Foods commitment to its core, social-organic market. Reach out to the price sensitive, health-organic market. Target the cross-over market from the restaurant industry who are looking for less expensive dining options. They could repackage their goods to be sold as cook-at-home restaurant boxes to intrigue those converting over from the restaurant dining option. Whole Foods should also focus marketing efforts on the West Coast and New England because these regions have the highest organic market density (). They could increase private-label products like meat and seafood. Another good marketing idea is to expand service offerings like store events for the community or online convenience ordering. They need to promote their product and brand name more often and a great way to do this would be to place their products on shows like the Biggest Loser or Top Chef. Television viewers will be more inclined to buy their product if they see it successfully used by other individuals on these shows. A big sale promotion that is almost always successful is to create a customer loyalty card. This would be a discount club card that maybe requires online sign-up. For every $1,000 spent at a Whole Foods store, the customer would receive a 10% off voucher (or something like that). This helps Whole Foods track consumer product preferences and sales accruement per customer. At the end of the year maybe invite the highest ranked customers to a customer appreciation event. Any of these tactics that help increase customer loyalty will greatly help Whole Foods retain and grow in their consumer market.

An onsite fitness facility would be a great addition for the Whole Foods employees. It builds upon their image of helping create a healthier individual. What better way to do that than with eating organic foods and exercising? If an onsite facility isnt in the budget, then maybe an alternative option would be to pick up the cost of an employees gym membership if they visited their health club 30 times a quarter. Any incentive that shows that the company is conscious and supportive of good health habits, only builds upon their mission of Whole People.CONCLUSIONS

After analyzing this company, our group agrees that Whole Foods is a steady, reliable company that takes pride in their products. They have a good vision of where they want to go and a mission statement that will take them there. Whole Foods will probably have a difficult time over the next few years, but they have shown as a company that they can persevere through about anything. Revenue growth can be spurred through a marketing campaign and community outreach. Costs can be controlled through reductions in direct labor, using buyer power to push down cost of goods sold, and reducing capital cost growth. Net income may not grow as much as Whole Foods might like, but the company can easily still remain profitable and continue to grow.

CONSEQUENCES

The possible consequences that Whole Foods might face if they choose not to follow some of the recommendations listed above, or simple continue to stay on the same path they are now, is that the company could be out-priced and bought out by other rivals in the industry. They might see an increase in organic foods in more cost-conscience groceries like Save-A-Lot or Kroger. Consumers who are on the fence about organic products might choose to first try out the cheaper brand to save the pocket book. If Whole Foods doesnt find a way to compete with the general grocery stores, like Kroger, they could soon become obsolete. Whole Foods needs to find a way to gain customer loyalty in the organic food market. They also need to grow in the number of customers they provide to on a regular basis, instead of just once or twice a year. As mentioned before, these customers could easily choose to go to another grocery to buy a cheaper priced good. If Whole Foods doesnt find a way to prove why the consumer should pay a higher price for their organic product, then they will likely find themselves loosing profit quickly. SUMMARY

Through all of the ups and downs that Whole Foods has experienced, at the end of the day you have to recognize that they are a great up and coming company and a force to be reckoned with in the food retail industry. With the growing popularity and demand for organic and natural products, we feel that Whole Foods would be a great company to invest in. They have a very effective strategy and are always looking for ways to improve their standings for consumers and investors. While financial standings arent the primary goal of the organization, they do realize the importance of creating economic value for the shareholders and that is essential to have a successful operation. Whole Foods also has one of the highest employee retention numbers out there because they understand the importance of creating a work environment that employees can enjoy and know you have to give back to the people who work for you in order to keep them in your organization. Without employees, an organization could never exist and in their motto, Whole People doesnt just apply to the consumers, Whole Foods wants to make sure they are creating a better employee and a healthier work environment which is why we feel Whole Foods would be a great organization to work for. The products that Whole Foods offers are ones that were made with the intention of creating a healthier tomorrow. Everyone is concerned about staying healthy and doing all the little things it takes to make sure we are as fit and active as we can be, and Whole Foods helps to supply the foods and products that we need to do that. They also focus on creating a healthier environment which many people are concerned about as well. We would definitely consider buying products from Whole Foods; however the prices on their products may affect how much we would actually buy. The increased price comes from the lack of competition and as the market demand shifts, the price will begin shifting as well. When we started this case, none of us had ever even heard of Whole Foods, and through our analysis we have truly stumbled upon what we are sure will be one of the best organic retail companies in the industry.