Current Strategic Issues
1.How does Whole Foods sustain positive growth in sales?
2.How does Whole Foods cope with the downturn in the economy? 3.How does Whole Foods achieve sustainable competitive advantage?
Rationale for Issues
One of Whole Foods main strategic issues is how it should sustain positive growth in sales. Sales growth in 2008 was 0.8%, compared to sales growth increase of 8.2% in 2007. However, much of these low sales growth figures were at the former Wild Oats stores rather than the stores that Whole Foods Opened. This is definitely a strategic issue because Whole Foods’ current strategic model is not showing positive sales growth. From $203 million in 2006, it fell to $182 million in 2007. It is clear that Whole Foods is losing its market share in the organic foods industry to its other competitors in the United States, and a new strategy needs to be created in order to increase and sustain its market share which in turn will increase sales.
Another important strategic issue that Whole Foods is facing is how it should cope with the current downturn in the economy. It is currently the world’s largest retail chain of natural and organic foods; therefore it has built a competitive advantage. But this competency needs to be sustained. Whole Foods has developed a brand and an identity for itself, now it is just a question on how to leverage this brand in order to maximize profits, and not let the recession affect Whole Foods negatively.
Whole Foods is different from other supermarkets because it has the strictest standards in terms of selling only foods of the highest quality in terms of nutrition, freshness, appearance, and taste. The question for Whole Foods is how you maintain this core competency over the long run, in which competitors cannot possibly match. In order for Whole Foods to fully distance itself from its competitors it needs to build competitive advantages to develop...