Segment of the Food Retailing Industry

Whole Foods sold various natural and organic foods and nonfood product, while competitors were selling organic food only as a portion of their products. Huge amount of perishables differentiated Whole Foods from other supermarkets. Because of this huge amount of perishable inventory, it is important for Whole Foods to figure out the equilibrium point between inventory and liquidity. Also, Whole Foods have to make sure that the products from suppliers are 100% meet the standard of the company and must be in the finest quality in terms of nutrition, freshness, appearance, and taste. Any tiny error may cause the whole corporation fail.

Created attractive and interactive store atmosphere to impress every customer favorably, and gave consumers a beautiful and comfortable shopping place and provided all kind of services would have certain effects on how likely a customer would come back to do shopping again. Nice, capable, and knowledgeable services were an essential ingredient of the store's atmosphere. Whole Foods encouraged its staff to offer their best services to delight every customer. However, it is not necessary to offer valet parking or massage. These services seemed to be offered in hotel not supermarkets. Whole Foods should cut down the expenses of hiring people for these positions and thus lower the price. Whole Foods had the good idea of home delivery, which is a feasible and workable approach to create sales, but it had not been implement widely.

Whole Foods only spending a small portion of its revenue on advertising, which was not enough, it missed a certain amount of potential customers that had not enough knowledge of natural and organic foods. Why should people abnegate their regular consumption and go for natural and organic foods with a higher price? How will these natural and organic foods affect their life and even the environment? How are these organic standards process? A lot of these kinds of questions should be answered in order to gain more customers. Therefore, Whole Foods should disseminate as much as knowledge to the public through advertising with a higher budget.

Before 2007, the biggest supplier for Whole Foods was United Natural Foods, which meant it would increase the expense of distribution, thus higher price for the items retailed in the company's store. Therefore, buying directly from producers and manufacturers could lower the expense and also might have better control over the quality of the products. On top of this, Whole Foods owned nine distribution centers, nine bake houses, five kitchens, and one more coffee supplied store, which not only enhance the quality of foods, but also cut down some media costs.