Whole Foods Case Analysis
Since John Mackey opened the first Whole Foods Market in 1980, Whole Foods has grown into one of the largest supermarkets chain in the nation. In the 80s, Whole Foods expanded mostly through acquisition. By late 90s and early 2000s, Whole Foods expanded more through opening their own new stores. By 2006, it became the nation’s largest natural foods retail chain and was listed on the Fortune 500 list. This paper is going to discuss Whole Foods’ strategy, the resources of Whole Foods that leads to its success, their social missions, as well as the challenges the Whole Foods is facing.
Whole Foods’ Strategy: Transform the organic food stores shopping experience
Whole Foods made a breakthrough in the natural food markets because it has transformed the image of organic food store from unreliable and inferior grocery shopping to the opposite. Whole Foods did that through two strategies: educating customers and creating an engaging and interesting shopping experience at their stores. It displays their food in attractive and exciting layouts, renovates their stores with modern and clean designs. It gives out pamphlets and put up signs in stores that explained concepts like sustainable, free range, and certified organic. The education makes customers feel comfortable with their buying. By educating the public on natural food concepts and providing transformative shopping experience, Whole Foods attracts mainstream customers and has popularized nature food.
There are three key resources that give Whole Food a sustainable competitive advantage over its direct competitors: (1) size and scale; (2) employees with experiences in conventional grocery stores; (3) Distribution efficiency and decentralized management. These resources create an unique and integrated system that reinforce fit among the company’s business operation and technology skills, allowing it to derive the most out of the value it created.