Introduction
The whole food is an American food chain that served the organic food products without implying the artificial additives. The chain specializes the products for the flavors, hydrogenated fats, colors, sweeteners and the natural foods. There are around 500 stores owned by the supermarket. Other than the United States it also has branches in the United Kingdom. The functional, financial, marketing, production and the organizational analysis reveals that company is trying to cope with the challenges after the year of 2008. Demand for the natural food has increased from the last fifteen years, and it has disrupted the progress of the firm. However, the corporation has experienced certain successes in the past and attempted to broaden its business.
Discussion
The whole food is a pioneer in providing the natural food products. From the time of 1980, it is consistently serving the purpose of healthy items for the Americans. The people have increasing interest regarding their health and food items. The twentieth century was seen as the best for the company because doing those forty years the corporation has experience number of successes. The head office of the company is located in the Austin, Texas. Other than Canada and the United Kingdom the corporation has ninety-five percent of the stores located in different states of America. With the merge of grocery stores, the management of the whole food has increased their progress in the early years of the development.
With the passage of time, the market of whole foods evolves from the store into the eateries where chefs prepare bakery items and the grocery fares. The operations of the company are related to the segments that are organic and the natural food. The lines of the revenues and the production are separated with the trio of prepared food, perishable food, and the food that is non-perishable. From the years of 2008, the demands for the natural has gained considerable importance from people of different walk of life. The growth of the stores went high with the economic growth rate of 15%. With the diminishing returns, the company is still facing the growth in its finances (Darmon, 2015). The chief executive officer of the company defended certain lapses with the statement that corporations cannot consistent with the same rate at all the times. The decade after the years of 2008 the store sales are less and moved into the negative side of the calculations.
The two quarters of the year of 2016 have lost with the marking of 2.4 and 2.6 percent. It was the fifth and the sixth consistent loss to the corporation. The management has identified certain strategic elements that are responsible for the consecutive decline in the business of the whole food. According to the assessment of the organization number of competitors have entered the market. The influx has provided people to turn around and look towards other food chains that might give them most appropriate natural food. However, some researchers reveal that there was no substantial impact of the new entrants over their industry. During the years after 2008 battle for the organic food has intensified. Studies confirm that the competition in the coming years will be increased.
The SWOT analysis unfolded that whole food has the primary strategic issue of significant opportunity that transforms into strength and now it became a threat. In the early days of the entire food market, there was the opportunity for the capitalization of the organic and natural food in the USA. With the people commitment towards natural and pure food, it ultimately effects and progresses the market of the whole food. The social trend of the consciousness-related with the health and awareness regarding food items have provided the growth of the food industry. Looking to the growing knowledge of the people more industrial partners enter the food market. According to the Mackey, the movement of organic food became value system and a belief which must be mainstream.
The consumers wanted for the natural food and the competitors like HEB, Publix, and the Costco are entered in the food market. The entrance of new stakeholders has focused the attention of market to produce competitive food rather than natural or organic food. The analysis in this regard has unfolded that prices are also affecting by the coopetition race among the major players of the market (Heasman, 2015). These competitors have the number of advantages like the Costco became the favorable price for the costumes to buy food from them. The Kroger provides the food along with the convenience which attracts the people to facilitate the services of the company. Such saturation has created a geographic issue for the entire and whole food industry.
The fifty percent people have the company of whole foods on a one miles while seventy-five percent have the corporation of Trader Joes at five miles. In the same way, eighty percent of the Costco food supply chain at the distance of ten miles. With this condition, people will prefer to contact with the closer supplier of the food chain, and it will ultimately affect the progress and revenue of the industry. However, the whole food has established rewards and grants for those costumes that visited from long distances. The years after 2008 are not suitable for the progress of the company. The company faces the consecutive decline in the net income during the recent years.
In contrast to the whole food corporation, other companies have increase growth. The Kroger has experienced 50% increase in its business. The Wholefood was unable to combat the competition of the sales during the years of 2013 to 2015. The quarterly profits of the company also fell drastically. To control the loss, the company has taken certain initiatives. The reduction in the selling, administrative and other expenses was an attempt to enhance the business profit. The corporation has eliminated around two thousand employees to reduce the burden of the payment (Johnston, 2008). It also reduces the costs of food along with the discount for the costumes. The company is tackling the issue of the external loss by broadening its network. Introduction of the 365 small stores in various states is an attempt to overcome the crises of loss. The cheaper stores are more affordable centers for the people in big cities.
The analysis of the broadening of business by whole food market shows the positive response from the people. After the establishment of these stores, the company will thoroughly examine the status of the profit and loss of the new stores. The changing demographics along with the recent development in different sectors of the international market possess the real challenges to the food company. Awareness of these problems are essential for the management to combat with the competitors. The warning given to the company by US health regulators over the food safety measures have spread negativity in the eyes of the public. The economic factors and the forces are also affecting the food industry with low and declining food prices. The deflation is impacting and slowing the business of food industry.
The whole food company needs to be careful from all those changing socio-economic determinants. The analysis of Porter’s five forces perspectives reveals that for whole food the competitors are the most problematic elements. The rivalry became intense, and the company will have to adopt certain defensive strategies. The power of bargaining is associated danger, and it is consistently influencing the competition in the industry (Ottman, 2017). People have the perception that whole food competitors are offering the same natural products throughout America. These individuals can switch to the other firms of the food chain because of low prices. They are mostly unaware of the quality of the food. The pilot loyalty program of the porter can be a tool to reduce the power of the buyer. The establishment of the rewards program will theoretically restrict the customer not to leave the supply chain of the whole food.
The whole food industry became late in launching the certain program and in applying of the different theories. The customer will perceive the entire food as organization and show loyalties are the question for the management because there is increasing awareness among the people. The rearranging of the retail pricing while analyzing the combine rivalries will provide benefit to the whole food (Schill, 2017). The company can control the bargaining power of the customer by applying decentralize and the empowered culture. The store at any locality must have the autonomy to decide the prevailing culture of the respective place. The stores can customize the products according to the demands and the trends of the locality. The unique product which are chosen by the leaders of the teams can come from the local, national or the international supplier. The partnership with facility providers for the production coffee, condiments, and the cheese will affect the business of whole food.
The integration of the diverse dynamics of the suppliers has provided to the whole food to control the movement of the risk factors in supplying the products. The international grocers are also arriving in America which poses a threat to the whole food market. The research and the analysis of the Deutsche Bank companies from Germany are rapidly planning for the opening of the five hundred stores in the USA. Aldi and Lidi are the two companies that are entering into the business environment of America. The lower prices of both companies have posted the real threat to the whole food corporation which is already weak. The Amazon has started its online business in collaboration with many industries. If the Amazon became successful in establishing the online business, it would profoundly affect the new small store idea of the whole food market.
At the present, there is no threat of the substitutes because organic food has no alternative in the market. The whole food should place its focus on the competitor as people are still using the organic food. For the external factors, the company needs to understand the forces of economics, social and the environment which are revolving around the food industry. The company will have to look at the food prices that are influencing the inflationary or deflationary moves (Schnorr, 2016). The deflation of the costs will provide the increased number of the customer to buy organic food. The prices of the food rely on the overall culture of the wealth. The value system of the organic food is also essential for the company as purchases will prevalent in the society or not. The corporation of whole food must consider the extreme weather, climate change and the perspective of increasing pollution.
Conclusion
Concluding the discussion for the whole food corporation, the competitors are rapidly increasing, and they will affect the position of the company. The analysis of the corporation after the year of 2008 shows that certain disruption are there in the finances, production, functions, market and the organizational sectors of the whole food industry. Over the last years, the company has face decline in business due to the increasing competition changing social trends. The company requires to get benefit from the intriguing strategic location and to employ practical measures to improve the business of the corporation.
References
Darmon, N., & Drewnowski, A. (2015). The contribution of food prices and diet cost to socioeconomic disparities in diet quality and health: a systematic review and analysis. Nutrition reviews, 73(10), 643-660.
Heasman, M., & Lang, T. (2015). Food wars: the global battle for mouths, minds, and markets. Routledge.
Johnston, J. (2008). The citizen-consumer hybrid: ideological tensions and the case of Whole Foods Market. Theory and Society, 37(3), 229-270.
Ottman, J. (2017). The new rules of green marketing: Strategies, tools, and inspiration for sustainable branding. Routledge.
Schill, M. J., & Blankenship, C. (2017). Whole Foods Market: The Deutsche Bank Report.
Schnorr, S. L., Crittenden, A. N., & Henry, A. G. (2016). Impact of brief roasting on starch gelatinization in whole foods and implications for plant food nutritional ecology in human evolution. Ethnoarchaeology, 8(1), 30-56.
