Organics Going Mainstream and Whole Foods Losing Out

I have been closely monitoring the news stories about Whole Foods over the past few weeks. As someone who grew up near a Whole Foods, and with parents who primarily shopped at Whole Foods, I have been to Whole Foods many times. I used to stand in never-ending lines on Sunday afternoons with my parents, as everyone swarmed the aisles to buy the organic food and niche products that only Whole Foods sold. Today, I no longer have to wait in long lines at Whole Foods, and it appears that others do not have to wait either. Today, there is organic food at almost every grocery store, and I feel less of a need to buy Whole Foods’ more expensive groceries.

Organics are now mainstream and Whole Foods has no competitive advantage. The once beacon of hope for healthy organic food that we thought could not be toppled, is falling at the heels of every other large grocery chain putting organic food in their aisles. In November of 2016, they fired their co-CEO Walter Robb, who grew Whole Foods “from 12 to 464 stores in three countries” (Wahba). In addition, their stock price has been diving since their peak on October 25, 2013 in which their stock price was $65.24, while today their stock price is $31.91. Just last week, Whole Foods received a 9% investment from Jana Partners, their CEO John Mackey’s new book talk “was sparsely attended” (English), they declared they are going to lower their prices, and it appears they could be ready to sell to Jana, Amazon, or another firm. Although they are working to create a centralized distribution system because of the many problems their 11 region distribution system is having, it appears it may be too late.

So how does Whole Foods’ struggles relate to our class? In many of our discussions, we talked about the importance of eating “whole foods,” “organic,” “non-gmo,” and we discussed the availability of food to all demographics of people. While Whole Foods certainly brought organic whole foods to the market, it appears they are not going to be the ones bringing organics into the future and they are not going to be the ones opening stores in food deserts to help alleviate the large problem of food insecurity in our nation. The democratization of organics is leading to the increased ability of people in low-income brackets to buy organics at whichever grocery store they choose.

I predict that in the next ten years, we will see food insecurity in our country decrease because large grocery chains will have the ability to buy organics at a lower price and will be able to open stores in lower-income areas. For example, a company called MOM’s--My Organic Market--that started in Rockville, MD, that now has grocery stores across the mid-atlantic opened a grocery store in a neighborhood in Northeast, DC--a low-income part of the city. That store was placed in a location where there was food insecurity and it allowed residents of the area to buy organic food at a reasonable price, and make them food secure. Today, the grocery store is thriving as consumers put more emphasis on buying organic, and buying organic at a lower price than Whole Foods.

MOM’s is just one example of a grocery store selling organic foods at a lower price than Whole Foods. MOM’s is not alone. They are one of many grocery stores now making organics accessible to everyone, making communities around the country food secure, and toppling Whole Foods.