External And Internal Realities Whole Foods Faces

Introduction

Whole Foods Market (WFM) is a dynamic leading supermarket chain offering quality food products that are certified organic and naturally grown. WFM embraces a mission of “Whole Foods- Whole People – Whole Planet”, where the main aim is to set excellence standards for food retailers. WFM operates through several wholly owned subsidiaries, with supermarkets located in the United States, Canada and United Kingdom. Its headquarters is located in Austin, Texas with a total employment of 64,200 people, of which an estimated 13,000 are working part time and 2000 are temporary employees. WFM had their first store in 1980 with only 19 staff. Today, WFM runs 340 stores throughout UK, Canada and United states, employing a figure of more than 73,000 people. This essay will be analysing the value chain of WFM in two areas: the primary and support activities.

Internal and External Realities of Whole Foods

With support and collaborations from many local vendors and international certification organizations, WFM embarks on the mission to improve the well-being and lifestyles of the consumers. WFM’s goal is to provide quality organic products at competitive prices that offer high value to the customers’ lives and as well as sustaining the environment. The organization’s unique culture, drive and management have presented many competitive advantages (Fishman, 2009). The innovative store environments coupled with wide and differentiated products selections add to its marketing strength to draw loyal consumers. A team of enthusiastic employees add value to WFM by going the extra mile for the customers and ultimately ensuring satisfying shopping experiences (Gamble et al, 2010). WFM’s consumers are educated about local farmers’ produce and offered seasonal products for unique savours and variety of local crops. Local farmers could help to reduce costs of transporting goods and at the same time ensuring product freshness at the stores. Products could be offered at competitive prices that satisfy consumers’ demands and friendly shopping environments concurrently build loyal relationships (Business week Magazine).

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Value Chain Analysis

Primary Activities

Partnering with Vendors

To provide consumers with a wide range of quality, high value and healthy natural organic products, WFM possesses very strict standards, especially pertaining to the selection of the products being sold in the stores. For example, fizzy soft drink products such as Coca Cola or Pepsi coke would never be found on the display shelves. Instead, WFM will look for alternative natural and healthy drinks to promote a better lifestyle for the well-being of the consumers. In order for WFM to do that, they had to work with the local agricultural and food vendors to create a sustainable food source that provides consideration to the health of consumers and without sacrificing on quality. Vendors are committed to honest and timely clear communication that creates transparency from the farm to the dining plate in order to bring in the highest quality goods available (wholefoodsmarket.com, 2009).

Purchasing Goods

WFM is dedicated to make informed choices for consumers, it possesses very stringent criteria when comes to the selection and purchasing of products. WFMs focuses and evaluates on freshness, nutritional value, ingredients, taste, safety and appearances of the products. Quality standards such as the Seafood Quality Standards and Animal Welfare Rating Standards are followed.

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Managing and Distributing Inventory

In order to attract customers and encourage loyalty, WFM stresses on perishables and local produces, which differentiate them from other supermarkets. However, ‘fresh produces’ is one of the most challenging products to run due to the limited shelf life and high cost of spoilage. Hence, WFM tries to solve this issue by supplying fresh produce locally, reducing time and shortening the supply chain. Relationships with local farmers are important to ensure the constant supply of fruits and vegetables. Whereas for seafood, it is an entirely different strategy, according to Supermarket Inc. video, it shows that WFM had introduced a seafood supply line for getting wild-caught Alaska catch from stream to store in less than 48hrs. WFM has an on-site purchaser who travels to various port fisheries and is empowered to make buying decisions for the company. His job is to select the freshest and best catches of the day and have them packed and flown out immediately to satisfy demand in the local stores.

Operating Stores/ Marketing and Selling

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WFM’s decentralized system comprises of inter-related teams, which are self-directed. This strategy imparts the mentality as stakeholder and the staff is free to decide on their own ideas to manage the stores. The motivated staff then strives to exceed the customer’s expectations with their vast product knowledge and passion in their work. They infect the shoppers with positive enthusiasm; going the extra mile to delight the consumers and ultimately helps generate loyalty by educating customers about organic food, nutrition, health and environment. These efforts enable WFM with a very successful marketing and sale advantage over competitors (Dess G, 2000).

Supporting Activities

General Administration

Using a decentralized system, WFM’s success comes from grass-root and team efforts in a horizontal hierarchy management that work towards achieving company goals.

Technology Development

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WFM constantly research and innovative throughout the years to investigate the needs and prevailing trends of consumers’ tastes and preferences, thus optimizing its value chain operations that help meet the high demand for quality products.

Human Resource Management

WFM believes that their people make their company and WFM makes available, tremendous support for their staff. Each and every staff working in WFM has to go through a stringent hiring process to find the right fit into the company culture with competitive rewards and recognition plans.

Procurement

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WFM works with local farmers and producers and develop collaborative win-win relationships to ensure good, fresh quality products.

Conclusion

The above value chain analysis show an important aspect of the business in determining the entire process from “farm to fork”. WFM’s value chain has demonstrated its efficiency in providing quality products that the consumers would demand while simultaneously support local economies. In addition, the natural environment is being valued and taken care of. The unique culture, management and values of the employees at WFM have played a vital role in ensuring the company’s vision and values are being achieved at the end of the value chain, making WFM a resounding success in its own industry.

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