Whole Foods Case Study
Introduction/Background Summary
Whole Foods Market was founded in Austin, Texas. Four local businesspeople decided the natural foods industry should be tried in a supermarket format. The founders of Whole Foods Market 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 first Whole Foods Market opened in 1980 with 19 employees. At the time, there were less than half a dozen natural food supermarkets in the United States which made Whole Foods Market an immediate success.
In 1984, Whole Foods Market began its expansion. The second store opened in Houston followed by one in Dallas and another in New Orleans. In 1989, Whole Foods Market expanded to the West Coast with a store in Palo Alto, California. To continue the success and momentum, they continued to acquire multiple stores throughout the 90’s; Wellspring Grocery of North Carolina, Bread & Circus of Massachusetts and Rhode Island, Mrs. Gooch's Natural Foods Markets of Los Angeles, Bread of Life of Northern California, Fresh Fields Markets on the East Coast and in the Midwest, Florida Bread of Life stores, Detroit area Merchant of Vino stores, and Nature's Heartland of Boston. The momentum continued into the year 2000 with the additional acquisitions of Food for Thought in Northern California and Harry's Farmers Market stores in Atlanta. In 2001, Whole Foods moved into Manhattan and by 2002, they saw an expansion into Canada and in 2004, Whole Foods Market entered the United Kingdom with the acquisition of seven Fresh & Wild stores.
Researching Internal and External Factors
Porter’s 5 Forces
Risk Analysis
Risk of entry by potential competition
High-Demand is growing and “big box” supermarkets are working on entering the natural/organic food market
Rivalry amongst competitors
Medium-High; Many new competitors are entering the market but Whole Foods still stands alone as the clear front
Whole Foods Market was founded in Austin, Texas. Four local businesspeople decided the natural foods industry should be tried in a supermarket format. The founders of Whole Foods Market 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 first Whole Foods Market opened in 1980 with 19 employees. At the time, there were less than half a dozen natural food supermarkets in the United States which made Whole Foods Market an immediate success.
In 1984, Whole Foods Market began its expansion. The second store opened in Houston followed by one in Dallas and another in New Orleans. In 1989, Whole Foods Market expanded to the West Coast with a store in Palo Alto, California. To continue the success and momentum, they continued to acquire multiple stores throughout the 90’s; Wellspring Grocery of North Carolina, Bread & Circus of Massachusetts and Rhode Island, Mrs. Gooch's Natural Foods Markets of Los Angeles, Bread of Life of Northern California, Fresh Fields Markets on the East Coast and in the Midwest, Florida Bread of Life stores, Detroit area Merchant of Vino stores, and Nature's Heartland of Boston. The momentum continued into the year 2000 with the additional acquisitions of Food for Thought in Northern California and Harry's Farmers Market stores in Atlanta. In 2001, Whole Foods moved into Manhattan and by 2002, they saw an expansion into Canada and in 2004, Whole Foods Market entered the United Kingdom with the acquisition of seven Fresh & Wild stores.
Researching Internal and External Factors
Porter’s 5 Forces
Risk Analysis
Risk of entry by potential competition
High-Demand is growing and “big box” supermarkets are working on entering the natural/organic food market
Rivalry amongst competitors
Medium-High; Many new competitors are entering the market but Whole Foods still stands alone as the clear front