Whole Food Market in 2008: Vision, Core Values, and Strategy

Farhan Yakoob Minhaj Ul Abdin Nabeel Ahmed Zia Zohaib Khan

10399 8665 17974 11772

Question No. 1 What are the chief elements of the strategy that Whole Foods Market is pursuing? Use Strategy Diamond to explain this part.
Arenas Staging

Quick expansion Whole Foods management

expected to have a total of 400 stores and sales of $12 billion in fiscal year 2010

Arenas

Natural and Organic Items Beverages Health Conscious People Geographically 3 countries Converting its Distribution Fleet
Vehicles to biodiesel Fuel Vehicles

Staging

Economic logic

Company operated
Vehicles stores(Internal Development) Acquisition of small ownermanaged chains Acquisition of Wild Oats Overall 276 Stores

Economic logic Premium prices due to unmatchable product quality and customer services People are willing to pay premium prices because they believe that they are doing something good and food is healthier.

Differentiators Differentiators

Differentiation
Through Competitive Price, Customer Service, Highest Quality, Experience Curve, Go Green, Big Store and Store Designs

Whole Food Market in 2008: Vision, Core Values, and Strategy

Chief Element: Highly selective about what they sell by maintaining and always experimenting inflexible quality standards Topmost quality in natural and organic foods and beverages.
Customer Service In C-13 according to the Industry analyst When you walk into a whole Foods Store, youre

overwhelmed by a desire to look at everything you see

In C-15.we take the best ideas from each of our stores and try to incorporate them in all our other stores. We are constantly making our stores better Company is actively doing its role in Community Citizenship and social activism.

Whole Food Market in 2008: Vision, Core Values, and Strategy

Question No. 2
Is the strategy well matched to recent developments and conditions in the natural and organic foods segment of the food retailing industry?

Yes, the strategy is well matched to recent development and conditions in the natural and organic foods segment of the food retailing industry, By looking at the certified organic farms in 2005 and in 2006, farmers are becoming more interested and attracted in organic farming. Whole Foods executive had said it was to the companys benefit for conventional super markets to offer natural and organic foods for two reasons: first it helped fulfill the companys mission of improving the health and well-being of people and the planet and, second it helped create new customers for Whole Foods by providing a gateway experience. That means that as more people were exposed to natural and organic product, they were likely to become Whole Foods customers because Whole Foods is the leader for natural and organic products, offered the largest selection at competitive prices, and provided the most informed customer service. In C-5 it is said that Consumer demand for organic foods is growing at close to 20 percent annually by keeping that in mind Whole Foods strategy is to open new stores around 400 by the end of 2010.

Whole Food Market in 2008: Vision, Core Values, and Strategy

Question No.3
Do you think John Mackey has a good strategic vision for Whole Foods? Why or why not? What do you like/dislike about the company's motto "Whole Foods, Whole People, Whole Planet?" Do the motto and the principles underlying it (Exhibit 1) really matter at this company or are they just nice words and cosmetic window dressing? Explain. Whole Foods, Mackey states that the foods they supply in their stores are the freshest with the least amount of artificial ingredients when processed. Whole Foods Market was awarded Certified Organic grocer by the Quality Assurance International organization. Whole People, Mackey states that he hires the best people to become team members People are encouraged to perform well with the Economic Value Added incentive system Teams are based on a decentralized structure so that team leaders would cooperate with other team leaders to operate the store in the most efficient and effective manner Whole Planet talks about the peoples responsibility to protect the environment Mackey noted that they contribute 5% on their net profits to not-for-profit organizations

Whole Food Market in 2008: Vision, Core Values, and Strategy

Question No .4
Do Whole Foods Markets core values as presented in case Exhibit 3 really matter? Are they real or just cosmetic window dressing? What evidence can you cite to support your answer? Have Whole Foods core values contributed to the companys success? Why or why not? Yes, we agree that the values as presented in case Exhibit 3 really matter to Whole Foods Market. They aim for high quality products and supply thousands of organic food and gourmet products In C-15 it clearly mentioned that how they are really committed to their core values to satisfy and delight their customers In C-16 it is stated that Team member across the company were encouraged to actively contribute ideas about the benefits they would like the company to offer Company is actively caring about the Communities and Our Environment by looking at the C19 company winning award in Green power partnership.

Whole Food Market in 2008: Vision, Core Values, and Strategy

Question No. 5
How well is Whole Foods Market performing from a financial perspective? Do some number-crunching using the data in case Exhibits 9 and 10 to support your answer. Analyze Using following ratios There is gradual increase of their net income. The gross profits of the company continue to increase as they acquire and dominate the market with more locations. We can study from these numbers and support the huge increase of Whole Foods Market as they continue to grow. Their long-term debts increase significantly from the acquisitions of Wild Oats Markets.

Whole Food Market in 2008: Vision, Core Values, and Strategy

Question No.6
How well is Whole Foods Market performing from a strategic perspective? Does Whole Foods enjoy a competitive advantage over its rivals? Does the company have a winning strategy?

Whole Foods Market is preforming well from a strategic prospective as they are increasing their locations and markets. They continue to provide healthy high quality foods and brands that are good for consumers, the environment, and their own growth in the industry. Whole Foods Market has been able to acquire the second largest competitor in their industry, Wild Oats Market, which eliminates the competition. They have competitive advantage to other supermarkets because of their high and fine products that they carry. Whole Foods also has the advantage of wellknown name thats associated with a higher quality for supermarket Products at more competitive prices.

Whole Food Market in 2008: Vision, Core Values, and Strategy Question No. 7
Do you approve of the decision to acquire Wild Oats Market? What pros and cons do you see?

We personally believe that the acquisition of Wild Oats Market was a good approach to dominating the market because Wild Oats is big competitor of Whole Foods. Another acquisition con is the conversion of the clientele of Wild Oats to Whole Foods Market. As with any loyalty, there is hostility when one loses what they love. This will take time but if Whole Foods can win their loyalty by offering what they need they will be able to better flourish.

Whole Food Market in 2008: Vision, Core Values, and Strategy

Question No.8
Were John Mackeys Internet postings unethical or in any way inappropriate? What actions, if any, do you disapprove of? What actions, if any, should the companys board of directors take with regard to his Internet posting and blogs? It is true from our belief that Mackeys internet postings were very unethical and inappropriate as there are expectations from the public for every business including CEOs. From our point of view he stepped over the line when he could not keep certain business dealings confidential. It is important that a CEO is a good businessman and it seems as if he were controlled by his emotions rather than keeping the good business standards. Mackeys bad behavior gives a negative image to the stakeholders that are involved. These include the business itself, the investors, the public, and many more. According to me the directors revoke his title or force a public apology to the FTC and all the stakeholders so that they can have a positive image again.

Whole Food Market in 2008: Vision, Core Values, and Strategy

Question No.9
What recommendations would you make to John Mackey regarding the actions that Whole Foods management needs to take to get through the recession that began in earnest in 2008? Should the company severely cut back on opening so many new stores? Should the company vigorously contest the reopening of the FTCs challenge to the Wild Oats acquisition? Are any other strategy changes needed? It is the phase of economic downfall so I recommend to Markey for Whole Foods management are to create a new strategy that enables them reaching out to new and current clientele given the new economic situations. The future is still unpredictable and economy can go either way and it is important that every business especially the one we are talking about here to able to adjust and make changes to unpredictable factors. As it is phase of economic downturn the firm should use the conservative approach rather than the aggressive one and should not go for any acquisitions which might result in the financial leverage and also company should cut back on opening until the economy gets better .They should be focusing on keeping the businesses that they and wait till economic conditions get better. The company should not strongly contest the reopening of the FTCs challenge to the Wild Oats acquisition.