Whole Foods Taking Over

Whole foods is probably the most well known company for selling organic products.  The companies strategy of selling natural foods has paid off and they have grown into an impressive organization.  The company is growing so large that it has been looking for smaller organic only companies to acquire.  Whole Foods recently had a merger with Wild Oates, a competing organic only store.  Although this may be a good thing for whole foods and advocates of all natural diets, it may hurt the farmers that have been supplying the smaller stores.  Because of Whole Food’s rapid growth they plan to consolidate their suppliers so that their supply chain will be more efficient.  This will mean that some of the farmers providing organic products will be dropped and they will not have another market to supply.  This would be very costly to these farmers because they most likely have dedicated much of their lives to their farm and a career change may not be an option.  Many people support organic products not only for the health benefits, but also for the benefit that it provides to small farms.  It makes them feel good to know exactly where their food came from and grew it.  They also feel good that they are contributing to the farmers livelihood.  Organizations like the Organic Monitor are worried that the lack of competition that whole foods faces will mean that many farmers may be out of work.



Instead of maintaining the many relationships that they now have with suppliers, whole foods wants to stream line and go with a few long term suppliers.  The fewer competitors that Whole Foods has the more power they have to choose who they buy from.  If they think a farmers prices are too high then they can just move on to the next farmer.  That farmer will have no one to sell to and other farmers will be competing for whole foods business.  Advocates of organic food are concerned that Whole Foods is monopolizing the natural foods market.  They are worried about the effect on the suppliers and also about smaller organic food stores. Whole Foods’ strategy may ultimately lower the price of organic foods and make it more widely available.  The could mean that it may be beneficial as a whole for our country, but it may hurt some smaller communities.  Would it be worth sacrificing some farms to make organic food more affordable and accessible? How could Whole Foods make their supply chains more efficient while still maintaining all of it current suppliers?  Would the opening of more organic food stores solve this problem by increasing competition for suppliers? Could the consolidation of suppliers compromise the quality of organic products or would it make them more reliable?

11 thoughts on “Whole Foods Taking Over

  1. Being a huge supporter of organic based products along with the vast selection Whole Foods has to offer I am excited to see prices go down in the near future, seeing that currently my budget cant afford to shop there often. Although I do love Whole Foods after reading about the lack of competition I am concerned about how this may effect the market along with the local farmers. While other major stores such as Dominick’s buys a small amount of organic products and such restaurant chains like Chipotle, If the market becomes cornered we might see a drastic decrease in organically grown products. Maybe these smaller farmers should work together in order to make a union or larger producer?

  2. I don’t know if it is only me, or maybe its the placebo effect, but i just find that the food from Whole Foods tastes better. Like Mike, I can’t afford to always get my food from there. Instead I resort to the more student budget friendly places. Many of these places do offer organic veggies, however, the produce also costs what seems like an arm and a a leg. It’s nice to know that in the (hopefully near)future if i wanna run down to Whole Foods and get some good eats, I can actually afford it!

  3. As long as they use existing suppliers as long term suppliers it shouldn’t impact the quality of the products they carry. Even if they do find new suppliers given the reputation Whole Foods has, I do no think they will compromise quality as this is what their company was founded on. Personally, I love Whole Foods and I agree with Swathi that food does taste better from there! Hopefully streamlining suppliers will mean savings to the consumers, as their prices are not the lowest… but always worth the quality you receive.

  4. I generally agree with all of the previous comments but I believe that diversification of the organic industry is necessary. Suppliers lead the ultimate demand for Whole Foods because those consumers choose what they desire. Lowering the costs of organic foods is a great option and I believe it should be maintained. From a separate perspective those consumers who want the smaller suppliers goods can go to farm markets nearby their community. Whole Foods is a business that developed a niche in a growing, environmentally friendly way. I believe that if they have sustained this size their suppliers will have to grow as well though I do not support the idea of crushing the “small business owner/farmer”

  5. I have to agree with William. I just can’t see that Whole Foods buying out small organic stores promotes some of the main values of the organic industry. When you walk into a Whole Foods or any other organic store you’re often greeted by many signs and labels that describe where that product came from or who it’s supporting. Along with our desire for whole natural foods comes the need to support the local stores, not just have organic food. I love whole foods, and it’s difficult to shop there because of their high prices, but there are other places to shop too. It’s like our society is shifting from Wal-Mart to the Wal-Mart of organic food – Whole Foods. There are farmers markets all over Chicago, support the local producers.

  6. as I call it “whole check” i find it amazing how they continue to grow and stay profitable. With such a dragging economy I do not understand how they can still pack the stores with such high product costs.

  7. Personally, I would rather choose a small healthier food store than Whole Foods. A lot of their products are not even organic, however, the prices do not reflect that. Besides Whole Foods there’s Treasure Island and Trader Joe’s that are big companies as well. The competition for Whole Foods will exists rather they buy smaller stores or not.

  8. I think Whole Foods is experiencing growing pains–they are becoming a national player with a lot of market share and influence in the organic food/health space, while at the same time trying to maintain #1 without compromising the ideals that made them popular in the first place.

    I personally think consolidation is good for the farmers–if Whole Foods decides to source all tomatoes for their Illinois stores from Batavia for example (I just randomly selected a city), then every tomato farmer in that town knows they have a guaranteed paycheck coming. No more schlepping to farmer’s markets all over the state hoping to generate a profit. Whole Foods also at that point has the opportunity to more closely monitor the quality of food purchased and assure that all of the tomatoes are grown in an organic manner without pesticides. By localizing, those things are much easier to control, which will ultimately lead to a better product for the consumer.

  9. I think that if any business were to use at least one source of organic foods it would help the farmers with their business instead of relying on Whole Foods who are clearly trying to resort on to cheaper supply chains. If you think about any restaurant who had at least one organic product that would make a substantial difference in the market.

  10. I find it very good to make organic foods more affordable and accessible. Yes it could hurt small communities, but as business people we need to look at the big picture and the larger impact. I think whole foods is on the right track

  11. Whole foods is a really tremendous company. I would encourage people to take a look at their 10k report because as far as innovation and development in their market they are the for runners. The way they treat their customers, their mission statement and their methods of acquisition and strategic planning are just extraordinary .

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