Mid-Year Update

Written By:
Jay Jacobowitz
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Sprouts Farmers Markets announces plans for 1,200 U.S. stores. In response, Whole Foods Market ups its projections to 1,200 stores from 1,000 stores. Fresh Thyme targets the Midwest for 50 stores, saying there are “gaps” in service from conventional grocers they plan to exploit. Mrs. Green’s, with nearly 20 stores in the northeast now, sets a goal of 20 new stores, branching out even more to the Midwest in the next couple of years. Earth Fare moves out of its southeastern hub up into the Midwest with store counts climbing over 30. Natural Grocers by Vitamin Cottage, with 81 stores, plans 15–20 openings per year for the foreseeable future.

And that’s just the high end of the market. Wal-Mart is introducing 200 organic SKUs under the famed Wild Oats label the company says will be within striking range of prices for similar conventional foods. Aldi, the hard discounter with 1,300 U.S. food stores owned by the same family that runs Trader Joe’s, is adding space for natural and organic fresh foods at conventional-food prices. Survey data now show that less-affluent households are aware of and aspire to better eating—meaning organic and fresh—but sometimes price is still an issue, as is access. With efforts from major players like Wal-Mart and Aldi, though, these barriers to purchase will inevitably fall away.

And let’s not forget the middle market; the conventional supermarkets everywhere that are adding their own organic private label lines and natural and organic fresh options because they realize U.S. consumers have made a fundamental shift in perceptions of food quality. (Case in point: Whole Foods beat its internal projections for new-store sales volume in…downtown Detroit!)

So, what are your strategic plans? Add fresh departments? Expand? At this moment, remember what the tailor said: “Measure twice, cut once. WF

Dear Reader: Please look for WholeFoods Magazine’s annual retailer survey questionnaire this July. We hope you’ll participate in the industry’s most informative independent retailer survey!

Jay Jacobowitz is president and founder of Retail Insights®, a professional consulting service for natural products retailers established in 1998, and creator of Natural Insights for Well Being®, a comprehensive marketing service designed especially for independent natural products retailers. With 37 years of wholesale and retail industry experience, Jay has assisted in developing over 1,000 successful natural products retail stores in the U.S. and abroad. Jay is a popular author, educator, and speaker, and is the merchandising editor of WholeFoods Magazine, for which he writes Merchandising Insights and Tip of the Month. Jay also serves the Natural Products Association in several capacities. He can be reached at (800)328-0855 or via e-mail at jay@retailinsights.com.

Published in WholeFoods Magazine, June 2014