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Wednesday April 16, 2014
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Whole Foods' crowded world

 

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The problem not just here but all over the country is that the supply of fancy grocery stores may have outstripped the demand. Whole Foods Market in particular has taken some very big hits lately. The company started in Austin, Texas, in 1980 and grew to around 300 stores-thanks, first, to its genius in identifying a surprisingly large, well-heeled demographic sector who were willing to pay much higher prices for high-quality food than anyone had previously realized. But then-bonus!-Whole Foods discovered that, paradoxically, those same people really weren't all that excited about cooking. After putting the expensive artisanal free-range raw food in the cart, they'd head to the other end of the store and buy the same stuff already cooked at even steeper prices.

Whole Foods' stock took a dive last year from $53 to around (as of this writing) $18 a share. Food prices are up, paychecks down. America's ambivalence over its perhaps out-of-control demand for luxury foods was beautifully played out in the national media this summer when Whole Foods was oddly entangled in a voluntary beef recall that backfired. When Whole Foods discovered that one of its minor suppliers, Coleman Natural Beef, was associated with questionable slaughterhouses and E. coli infections (in ground beef destined for Kroger meat counters), it voluntarily recalled all its Coleman beef. Though no tainted beef had ever passed through Whole Foods (which, Klotz points out, grinds its own hamburger, and therefore was never remotely associated with the scandal), and though Whole Foods had acted quickly and responsibly to distance itself from a problematic supplier, customers read the story differently. The revelation that Whole Foods and Kroger used any of the same suppliers at all, ever, shocked some Whole Foods customers. As Klotz says, "Well, that was a bad week around here."

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