Whole Food Market Harvard Case Solution & Analysis

Q5.) How well is Whole Foods Market performing from a strategic perspective? Does Whole Foods enjoy a competitive advantage over its 3 chief rivals—Wild Oats, Fresh Market and Trader Joe’s? Does the company have a winning strategy?

Whole Food Market’s strategy is to grow its operation with addition of new store or via addition of new stores through acquisition of other small organic food companies; meanwhile, it has been able to generate average weekly sales of $549,000 from stores and this average growth margins in all stores had been at a stable rate of around 34% during the past results as shown in exhibit 5. Moreover, sale of organic foods products and introduction of innovation into these organic food products has proven its performance.

Fresh Market is a family owned business with total number of 94 stores representing around one half of Whole Foods Market’s number of stores, meanwhile, the area of these stores is almost similar to that of Whole Food Market’s stores area with annual revenues of $655 million in the year 2009, which does not seem to be a competitor of Whole Food Market.

On the other hand, Trader Joe’s with 339 stores in 25 states represents larger retailer of organic food in terms of stores, meanwhile, it also plans to acquire more store in future and Trader Joe’s enjoys estimated revenue of $8 billion in the year 2009; which are almost equal to that of Whole Food Market’s annual revenues in the same year. In addition to this, its large stores have given it cost leadership advantage.

However, since Wild Oats is a small producer of organic food product; therefore, it is not in a position to compete with Whole Food Market. Consequently, Whole Food Market has somehow a competitive advantage over its competitors because it generates more revenues from less number of stores in comparison to Trader Joe’s other competitors, who are not in a position to compete with Whole Food Market.

Furthermore, Whole Food Market has a winning strategy that it has adopted in managing its supply chain along with research and development of new organic food products. Additionally, its distribution channels, development and retention of staff lead it to improved financial performance.

Q6.) Does the company have any sustainable strengths/competencies? Justify your answer.

Whole Food Market has number of strengths and capabilities that it can sustain in long run including its brand name for offering organic food products that are known for its better quality and long established business experience. In addition to this, the capabilities of its team members will let it to sustain a business culture that will lead to the overall sustainable development of business practice throughout its stores. Additionally, its emphasis on social responsibilities such as donation and loans to farmers will lead to sustainable relationship with farmers for procurement of quality organic products.

Q7.) Based on a SWOT analysis you complete, what recommendations would you make to John Mackey regarding the actions that Whole Foods’ management needs to take to sustain the company’s growth and financial performance?

In order to pursue international growth, John Mackey should in invest in marketing campaigns, which will create awareness of its brand among its world consumers and these marketing strategies can be deployed through online websites and social media sites; which will provide Whole Food Market an opportunity to directly interact with international consumers of organic food products. Moreover, John Mackey should emphasize on its efforts towards the sustainability of environment, which will attract more consumers who prefer environment friendly companies. Additionally, John is recommended to control its high gearing that is threatening its cash flows through high interest payments; meanwhile, John Mackey should develop its strategy in order to establish business partnerships with well known chain stores; which will further increase its revenues growth................................

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