My first impression of the store was how different is its layout is from most other chains. It reminded me of Trader Joe's, whose aisles are also laid out in odd patterns, and similarly narrow.
These aisle patterns and widths seem to discourage fast, volume-oriented shopping. Supporting this, shopping carts are smaller, too.
In line with the Journal's piece, I noticed some fairly high prices on many items. Not uniformly so, but sufficient to make it clear that spending most of one's grocery dollar at Whole Foods would quickly make a major dent in your budget. Following up on my daughter's questions about some cuts of beef, I noticed that Whole Foods' offerings were literally triple the price of the same items at Costco, from which we had just come.
The mix of customers were more like those I saw in Trader Joe's, too, and less like other, larger local grocery chain stores. For example, there seemed to be fewer parents with young children. Perhaps the largest difference I noted was that lack of pace of other shoppers. Some were obviously married, empty-nesters, taking a lot of time strolling through the store.
On a Sunday afternoon, the store did not seem especially crowded. Then again, maybe it never is. As I noted, this was my first visit.
Turning to the article about Whole Foods in Monday's Wall Street Journal, it seems that perhaps what I observed on Sunday echoes what the chain is experiencing nationwide.
Nearby are the 2- and 5-year price charts for the company's stock and the S&P500 Index.
For the past 24 months, Whole Foods' equity price has fallen by some 80%. It's decline really accelerated in the past 12 months.
Looking back further, the 5-year chart shows the company's rising fortunes in 2004 and 2005. Beginning in 2006, however, the peak of the company's equity price had been realized.
Thus, there may be a lot of truth in a quote appearing in the Journal piece by Bob Summers of Pali Research,
"It's kind of the wrong time, wrong concept."
For what it's worth, the local, lower-priced Stop & Shop chain has organized its own product portfolio into a private-label organic brand. Further, it has grouped those items into one section of the store. So the organic-based differentiation of Whole Foods has already been competitively addressed by other chain stores in the area, including BJ's and Costco.
That makes the overall tone of the Journal's article quite believable. It notes the lack of cash on Whole Food's balance sheet, and its Starbucks-like wrangling with landlords in various shopping centers as it attempts to back out of prior lease commitments.
It's not hard to see the company continuing to appeal to a segment of high-income, small-family or empty-nest couples and singles who wish to consume only organic food and can pay the higher prices for it. That's a reasonable strategy, but for a niche player, not a nationwide chain of large grocery stores.
The next 12-18 months should be interesting ones in which to observe Whole Foods adapt to economic changes in the US.
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