Samira Ghaffari
Shannon Kennedy
Josh McGuire
Paul Maurer
Company Overview
 CEO John Mackey
 Founded September 20, 1980 in Austin, Texas
 Founders: John Mackey, Renee Lawson, Craig
Weller, Mark Skiles
 Merged Safeway and Clarksville Natural Grocerer
 Began expansion in 1984 (Houston, Dallas, New
Orleans)
Company Overview - Acquisitions
 Growth was fueled by acquiring
other local natural food chains
throughout the 90’s
 Chains in North Carolina,
Massachusetts, Rhode Island,
Los Angeles, Northern
California, Florida, Detroit and
Boston
 Initial Public Offering on
January 23, 1992 at $2.13/share
 2001 moved into Manhattan,
generated interest from media
and financial industries
International Expansion
 2002 moved into Canada
 2004 expanded into the United Kingdom
 299 total Whole Food Market retail stores
 287 in the United States
 6 in Canada
 5 in the United Kingdom
 Canada/United Kingdom stores accounted for 3% of net sales
Employment Overview
 47,478 U.S. Employees
 1,901 Outside U.S. Employees
 Salaried: Associate Store Team Leader ($68,405)
 Hourly: Prep Food Service Team Member ($23,337)
 4,287 jobs lost in 2010, 9% job decline
 617,696 applicants for 1,160 job openings
 Non-Union
 All stores are company owned
Sales by Product Types
Corporate Strategy- Growth Strategy
 External growth strategy
 Increase of stores
 Differentiation through customer satisfaction
 Measurements of performance
 “Green” initiative
Store Growth
Number of Whole Food stores by year
350
300
250
200
150
100
50
0
2006
2007
2008
2009
2010
Differentiation
 Aims to make customers their first priority and
satisfy their needs
*http://www.wholefoodsmarket.com/company/corevalues.php
Evidence of Customer Satisfaction
Customer Satisfaction Index
90
85
80
75
70
65
2007
2008
Whole Foods Market
2009
Publix
Kroger
2010
Safeway
Industry
Performance Measurements
Whole Foods
Market
Publix Grocery
Revenue of FTE
$198,802.74
$359,057.91
ROI of Human
Capital
$1.90
$2.15
Competitive Advantage – “Green Mission”
 Whole Foods aims to have wise
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environmental practices
2.8 billion megawatt hours of windbased renewable energy has been
purchased
14 stores and 1 distribution center is
using or hosting rooftop solar
systems
WF discontinued plastic grocery
bags at checkout in 2008.
Implemented a reusable bag refund
at checkout. $.05 per reusable bag
2007 WF introduced fiber packaging
in the prepared foods department
http://sec.gov/Archives/edgar/data/865436/000110465910059917/a10-19737_110k.htm
“Green Mission” Achievements
 Whole Foods earned 6 EPA
Green Power Awards from 2005
to 2010
 11 stores received Leadership in
Energy and Environment Design
(LEED) Certification by U.S.
Green Building Council
 2 stores have earned Green
Globes from the Green Building
Initiative
 First national retailer to provide
Forest Stewardship Council
(FSC) certified paper bags
originating from post-consumer
recycled fiber
http://sec.gov/Archives/edgar/data/865436/000110465910059917/a10-19737_110k.htm
Figure 1: (Historical ACSI Scores)
HR Professionals
2010 Financial Statistics*
*For fiscal year ended 9/26/2010
Comparative Financial Statistics*
*For fiscal year ended 1/1/2011
5 year stock performance
WFM Stock Prices
Over Past 5 Years
61.08
50.41
39.84
27.35
9.41
2007
2008
2009
2010
2011
Exemplary Area
•
•
•
•
•
Performance Management
Conducted a phone interview with Daniel Gomez,
store manager of Annapolis Whole Foods
Whole Foods uses a Gainsharing system
System of sharing with employees greater-thanexpected gains in profits and/or productivity
Percentage of sales is dedicated to labor, then the
shortage from labor is re-distributed to team
members
Motivates employees to work harder in order to have
a greater shortage to distribute amongst employees
Ranking
 All-Star Ranking
 Store Level
 Employees are rewarded at an all-star: top sales in
country, top sales in region
 Whole Foods employees feel motivated when they
receive public acknowledgment
 Money is not the only motivator
“Cool-Bean” Program
 Customer Service program based on

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


comments & feedback from
customers about employees at a
store level
If customer mentions the employee
doing a good job at work, employee
is granted with a “cool bean”
5 Cool Beans = $50 Visa Gift Card
10 Cool Beans = Jacket & $50 Visa
Gift Card
Up to 30 Cool Beans = Jacket &
$250 Visa Gift Card
Program rewards employees who
have superior customer service skills
Team Leader Bonus Programs
 Team Leaders receive a
certain amount of money
based on different
categories of sales, i.e. sales
per labor hour, margin
sales
 Occurs every fiscal period
 Motivates team leaders to
work harder in order to
receive the bonus
Overall Performance & Feedback
 Whole Foods hold leaders to high standards
 Once a year managers sit down with leaders and go over job
expectations and responsibilities
 Opportunity for leaders to get feedback about performance
 Every period team leaders & employees are evaluated based
on margin, labor, etc.
 Every 3 months moral surveys are conducted to give
employees a chance to express feelings about all areas or
issues that might harbor problems, i.e. working environment,
lunch and break periods, pay scales, and communication
Strengths of Whole Foods
 Selection rate: .18%
 Compressed workweek
 Telecommunicating
 Reward programs
increase performance
which increase company
sales
 High Diversity-45%
minorities and 44%
women employees
Photo from:
http://www.keymechanical.com/Project%20Photos/Whole
%20Foods%20at%20Bellevue%20WA.JPG
Weaknesses of Whole Foods
 Product recalls erode brand image
 12 recalls in 2011 as of April 27
 19 recalls in 2010
 71 recalls in 2009
 7 recalls in 2008
 15% turnover rate
 9% decline in jobs
 No paid leave
 No onsite childcare
Future of Whole Foods - Opportunities
 Increasing
demand for
organic products
 Increasing
popularity of
private labels will
improve margins
 Rising popularity
of online retailing
Future of Whole Foods-Threats
 Competition from other grocery stores
 Increase in number of organic grocery chains
 Increases the competition for vendors and suppliers to supply
Whole Foods
 Economic downturn in US affects consumer
spending
 Stringent regulations impose additional liability
Keys to Whole Foods Past & Future Success
 Expand global market
 Culture sets them apart. Need to maintain current
culture and continue to improve based on employee
surveys and feedback
 Stay customer focused
 Continue to motivate employees and team leaders to
maintain a hard working staff that creates profit for
Whole Foods
 Change values to stay competitive in market place



Past values: Promote local organic ingredients
Current values: Improve relationships with suppliers and vendors
Promote healthy lifestyle through eating healthy
References
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CNN Money. (2010). 100 Best Companies to Work for in 2010.
Retrieved May 3, 2011, from CNN Money:
http://money.cnn.com/magazines/fortune/bestcompanies/201
0/snapshots/18.html
Historical ACSI Scores. (n.d.). Retrieved March 24, 2011, from The
American Customer Satisfaction Index:
http://www.theacsi.org/index.php?option=com_content&task=view&id=
206&Itemid=215
Organizational Chart Whole Foods Market. (2011, March 7). Retrieved
March 24, 2011, from The Official Board:
http://www.theofficialboard.com/org-chart/whole-foods-market
Safeway. (n.d.). Form 10-K. Retrieved March 25, 2011, from
http://quote.morningstar.com/stock-filing/AnnualReport/2011/1/1/t.aspx?t=XNYS:SWY&ft=10K&d=54c0fdfbbe89eb36fa3704cf8e6a7017
Whole Foods Market. (n.d.). Form 10-K. Retrieved March 24, 2011, from
http://www.wholefoodsmarket.com/company/pdfs/2010_10k.pdf
Mathis, R.L. & Jackson, J.H. (2008). Human Resource Management (12th
ed.). Thomson-Southwestern. Mason: OH.