Keys_to_seminar_8_-_Whole_Foods

Keys_to_seminar_8_-_Whole_Foods - Whole Foods Market 2007:...

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Unformatted text preview: Whole Foods Market 2007: Will There Be Enough Organic Food to Satisfy the Growing Demand? Seminar Case 8 12 - 2 Whole Foods Market Q 2. Competitive Analysis, cont. Suggested: Growing number of firms will be Substitutes competing for customers solely on price as more Med and more natural and organic foods are sold in different stores. Wal-Mart will be a tough competitor due to their vast and efficient existing distribution system, which enables cost saving and therefore lower prices for consumers. Threat of Suggested: Customers could buy nonorganic products that are better priced, but without the same quality levels. Customers could also opt to grow their own organic fruits and vegetables in private or public gardens. . Suppliers Power Med-High Suggested: Suppliers will be able to command a higher price due to increased demand Suggested: Economies of scale available to established stores who wish to expand into organic produce. Vertical integration into processing, distribution also possible. Rivalry High Buyers Power Low Suggested: Buyers do not purchase in large quantities and are unable to negotiation price and terms. New Entrants Barriers Low-Med 12 - 3 Whole Foods Market Q 2. Industry Life Cycle • Life cycle of an industry Introduction Growth Maturity Decline • Emphasis on strategies, functional areas, valuecreating activities, and overall objectives varies over the course of an industry life cycle 12 - 4 Whole Foods Market Q 2. Industry Life Cycle, cont. • Natural and organic foods industry is currently in the growth stage, where rate of revenue growth increases • Originally established by small independent stores, discounters and traditional grocers see profit potential: - Organic foods sections are expanding in traditional groceries - Acquisitions and growth such as Whole Foods has done is occurring elsewhere, but these are now late entrants, chasing industry leader Whole Foods ...
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Keys_to_seminar_8_-_Whole_Foods - Whole Foods Market 2007:...

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