Background on Whole Foods
* John Mackey began with single store which grown to be nation leading natural food chain. It offers natural (free from growth hormones and antibiotics) and organic foods which are standard. * In 2002 Whole food world leading retailer of natural and organic food with 193 stores in 31 states, England and Canada. * Wild Oats was bought by whole food in 2007 by $ 565M.
* Each department composed of team leader and 11 employees . * Each store contains from 71 to 391 employees .
* It is one of 100 best company to work for, by Fortune magazine. * Their goal is 100 % CUSTOMER SATISFACTION, realizing their life blood for their business .
* Whole food now competes with all supermarkets. Their competitors mainly are: * Wild harvest section of shows
* Lifestyle stores opened by Safeway
* Big box
* Los Angeles based Trader Joe’s
* Their choice of placing stores depend on human density, education level, high level customers ad may other factors. * It also contains take action center, home delivery , cooking classes, massages and valet parking . * Only 0.4% of its sales are spent on marketing. It depends mainly on word of mouth. * Whole Foods Market donates 5% of its after tax revenues. * Opening a new store is very hard as it costs a lot, takes a lot of time and requires distribution facilities and management.
Threat of new entrants
| Already there are competitors in market as increase in demand on premium organic food increased moving to this industry, but the competition is in continuity.
| Bargaining power of buyers
| After the financial crises of 2008 many employees suffered layoffs, cut their salaries or not employed anyway so many of them will shift from highly delegated types of food to ordinary and cheaper foods.
| Bargaining power of suppliers
| This happen when markets expands as only 1% of farmland are farmed organic and the big retailers are in better position than smaller one and due to European expansion too.
| Threat of substitutes
| Change diet of people, financial crises, looking for new products and new markets.
| Relative power of stakeholders
| As if we talked about marketing point we will find that only 0.4% of sales are gone to marketing and this is bad condition as we are in a competitive market and there are many competitors so management should change.
1. Political Factors:
Political factors affect whole foods market from different perspective like global, national, local, Political parties and elections that have influence also on the industry. Globally, whole food market affected by turmoil in all countries supply the company with products or supplementary products like crude oil, the Political unrest in Egypt has caused oil prices to spike out of fear that unrest could spread to other Middle Eastern crude-producing countries rising demand expectations. Nationally, there are different activities could affect the company like taxations which is stable now and there are no call for more increase in tax on this kind of industry. New pesticides are being banned regularly, leading whole food closer to a more organic culture. Moreover, diseases such as Mad Cow and Avian Flu spawn intensive governmental regulation to protect the welfare of the general public. Recently, there has been great debate on the standards that define organic foods. Large companies have tried to use their influence in Washington to weaken the national standards to allow certain synthetic substances in the preparation, processing, and packaging of organic foods. Despite resistance from organic activists, the new standards were passed into law as part of the 2006 Agricultural Appropriations Bill Political movements and pressure groups have positive impact on the company as it support the company mission in...
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