Re: Whole Foods' revenues
Rich Molini (firstname.lastname@example.org)
Thu, 13 Nov 1997 18:10:41 -0500
Michele Gale-Sinex/CIAS, UW-Madison wrote:
> Howdy, all--
> I'm writing to reflect on this item that Eric posted:
> Whole Foods sales top $1 billion
> By R. Michelle Breyer
> Austin American-Statesman Staff
> Published: Nov. 12, 1997
> Whole Foods Market celebrated its first billion-dollar year, reporting
> record sales and earnings for fiscal 1997.
> And the subject line that Eric put on it: Organic is expanding.
> How do Whole Foods' increased sales revenues reflect or demonstrate
> an "organic is expanding" trend?
> What this article says to me is that WF's profits have increased. Its
> increases in sales may have more to do with corporate takeovers and
> product line management than any reflection on organics per se.
> Let's not confuse the two.
> What I see in this story is that Whole Foods' revenues have expanded
> as they've absorbed local competitors and their sales. Whole Foods
> sells a lot of conventionally produced foodstuffs. The article
> spoke of "natural" foods, and I don't know what that means. (What
> are unnatural foods? Twinkies? PowerBars? Foods modified by
> application of fire?) I don't see any data here around organics.
> And I'd want some, before concluding Whole Foods has helped "expand"
> organics. It may be they're cleaning up on awareness built by other
> forces and entities.
> Sure, the potential is there. Like Microsoft could start producing
> an operating system with half the common sense utility and
> reliability of Mac's OS 1.0 beta.
> But I'd like to see *data* before crediting them with something the
> smaller businesses here have been doing for twenty or thirty years
> (e.g., Mifflin St. Co-op, founded 1969, Willy St. Co-op, incorporated
> 1973; that says CO-OP, not CO-OPT). Hell's bells, friends, a Texas
> chain supermarket, expansionist in nature, mega-corporate in culture,
> and desperately dependent on cheap fossil fuel can't hardly come to
> the Upper Midwest and take credit for folks' attitudes hereabouts of
> cooperation, community building, and alternative agriculture. :^)
> In some communities, Whole Foods is the only source of organic or
> "natural" foods. In others, WF moves into an area and takes over
> markets served and cultivated by smaller whole or natural or organic
> foods stores. They sometimes move customers out of the economic
> (and social) flows that nourish these smaller businesses. They
> convince those customers that it's easier to shop at WF and "less
> convenient" to shop at smaller businesses.
> My understanding is that this hasn't happened in Madison; customer
> loyalties to Mifflin, Willy St., Magic Mill, etc., are pretty strong
> This consolidation of markets may appear as an increase in black ink
> for WF, but what's the real nature of this good news? Is it possible
> to sort out WF-the-corporate-entity from organics-the-social-movement
> from Whole Foods' actual impacts on the organics market? How can we
> distinguish between WF taking over existing markets and an actual
> expansion in organics' market share?
> Economies of scale require large, anonymous market interactions.
> It's a fact of communications work in any sector (business,
> agriculture, education, love, etc.) that there's some limit to how
> many relationships you can have and still get things done without
> going bazonkers. It may vary from person to person or organization
> to organization, but time and energy remain limiting factors.
> I see Whole Foods finessing this tension in a particularly 90s way:
> they give great customer service on a store-by-store basis. I've
> never seen a big corporation bend so far backwards to accommodate
> some of the most wacky customer demands I've ever read. They post
> their customer feedback/request forms, and I swear, it embarrasses me
> sometimes to see what some customers are asking for--they put the
> P.U. back in puling. And WF always answers with a completely
> straight face...though I know that the pens of some of the employees
> in Madison must have their Irony Phasers set to full stun.
> But I don't know how well WF serves producers of locally, organic, or
> sustainably grown foods. I don't see a producer, community, or
> activist feedback bulletin board at Madison's WF. I've been telling
> them for nearly two years now about some of the specialty producers I
> hear about or get to know...and haven't seen many of these on their
> shelves, and when I ask, the answer is, well, they can't deliver
> their products at the quantities we need to make the shelf space
> worth our while.
> Economies of scale.
> I own a microbusiness. I don't feel particularly excited about this
> bigger-is-inevitable trend in organic, natural, and whole foods
> retailing. At the same time, I have deep concerns that we move
> sustainable and organic agricultural practices and principles into
> the reach of more people. In ways that EVERYONE can afford AND that
> don't bastardize their original intent nor dilute their power. I'm
> not sure how that will play out. I do know that building and
> honoring human relationships (communication, and not of the mass
> sort, though some of that will also be needed, Mr. Turner, if you're
> listening) has something to do with it. One of the primary
> motivating forces we see in Wisconsin in the organic movement are
> human things, like the restoration of a sense of safety, trust, and
> connection, mediated by food.
> I'd like someone with an economics background to look at Whole Foods
> and inform all of us: how can we sort out the actual growth and
> expansion of the organic or natural foods markets from WF's corporate
> takeover, drive-out-other-players strategies?
> Personally, when I look for evidence that organic is expanding, I
> look to the growth of CSA, of farmer's markets; the strengthening of
> local co-ops; the formation of new co-ops; the increase in community
> gardens; and the so-called "soft" stuff like growing awareness,
> information, and learning communities around the concepts and
> practices of organic farming and sustainable living.
> Yours in curmudgeonly hopefulness, sharpened by today's headlines
> about Microsoft and Kodak. Thanks for listening.
> Michele Gale-Sinex, communications manager
> Center for Integrated Ag Systems
> UW-Madison College of Ag and Life Sciences
> Voice: (608) 262-8018 FAX: (608) 265-3020
> The Force is a lot like duct tape. It has a
> light side and a dark side, everyone has it,
> and it holds the universe together. --Mister 3D
I thought I would see a number of positive responses on your post , but
it looks like us Indiana boys have to jaw about supporting your
insightful questioning of what Eric thought was good news.
I am sorry, but when I see phrases like successful acquisition,
analyst's projection, and dominant position in an article ( actually it
appear to be more of a spam) , I get a real bad taste in my mouth and
it's not all gingivitis. WF does not appear to hold any of the issues
such as smallfarms, revitalization of rural America, local trust and
market building, value added, etc. near or dear to their corporate
heart. They are ostensibly following the path of other global corporate
sharks ( I read Alan Guebert ), and that is consistent only with
conventional agribusiness, a nutritional, economic, social, and
Later, Rich Molini
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