Whole Foods Case Study - Discuss the Trends in Retailing of Organic Foods and the Impact of These Trends on Whole Foods Market

Whole Foods Case Study

Discuss the trends in retailing of organic foods and the impact of these trends on Whole Foods Market.

Whole Foods is the world’s largest supermarket retail chain of natural and organic foods. This supermarket wanted higher quality, less processed, more flavor and preserved natural products. As the leader in natural and organic foods, Whole Foods looked for consumers that were concerned about what they were eating, their eating patterns and their health and wellness. John Mackey, CEO of Whole Foods has a vision that he doesn’t want to become just an international brand with natural and organic foods, but to be the best retailer in every community (Thompson, Strickland, & Gamble, 2010). Whole Foods company motto is “Whole Foods, Whole People, Whole Planet,” (Thompson, Strickland, & Gamble, 2010), this purpose is to help support health, well-being, and healing of both people-customers, team members, and business organizations and the plant. (Thompson, Strickland, & Gamble, 2010)

The demand and trends for natural and organic is increasing with more people wanting to live longer, healthier, and more pleasurable lives. In 2000, the United States Department of Agriculture (USDA) reported more organic food was sold to supermarkets than the 14,500 natural food stores (Thompson, Strickland, & Gamble 2010). Congress passed the Organic Foods Production Act (OFPA) in 1990, to develop the standards and organically produced agricultural products to assure consumers that these products are marketed as organic meet the uniform standards. Meat, dairy and bread were the largest and fastest growing organic product being sold.

The OFPA began looking into supermarkets that were labeling their own brand names of organics. The struggle to find organic beef and chicken caused Whole Foods to find suppliers to meet their needs. Consumer demand was growing at a rate of 20% every year. A barrier of purchasing from a supermarket is the higher prices. Whole Foods decided it must focus on fresh fruits and vegetables, baked goods meats and seafood. An advantage to organics being sold in local supermarkets help to educate consumers on a healthier option but to shop at Whole Foods for larger variety.

Evaluate the competitive environment of the firm: Apply Porter’s model and analyze each factor relative to the company.

Porter’s Five-Forces Model is considered a powerful and most used tool in the competitiveness of industries. Porter’s five forces are listed as: firms in other industries offering substitute products, potential new entrants, buyers, rivalry among competing sellers and suppliers of raw materials, parts, components or other resource inputs. (Thompson, Strickland, & Gamble, 2010)

Markets are a competitive battlefield, so rival sellers will use any and all tactics to strengthen