Whole Foods Case Brief

1744 Words7 Pages
Re: Whole Foods Market Case Brief The natural and organic food supermarket industry is emerging in today’s society due to the increase in consumer interest in healthy lifestyles. This is partially a result of the media coverage natural and organic foods has received in recent years as well as educated consumers willing to spend more money on their health. This case brief examines Whole Foods Market as it performs in the industry to determine whether or not this is an attractive industry based on Michael Potters: Five Force Analysis, Jay Barneys: Looking Inside for Competitive Advantage and finical data. INDUSTRY FIVE FORCES ANALYSIS Threat of New Entrance – moderate: getting stronger The main barriers of entry are investment cost, government regulation and access to supply. High initial cost for new entrance includes the cost to acquire property with optimal location as well as stock a variety and quality of inventory. A success factor is to locate where lifestyles of consumers appeal to higher priced natural and organic products and close to suppliers to ensure high quality produce. The primary barrier for new entrance to overcome would be gaining access to a verity of natural and organic foods on a large retail scale at this point in time. Conversely this barrier can be overcome with increased suppliers. The USDA regulations regarding natural and organic food require retailers to provided additional documentation hindering new entrances with additional time and resources. In addition, newcomers may fear the industry in regards to being bought out due to Whole Foods recent buyout of Wild Oats. However, there is no research and development or heavy equipment cost to incur which potentially lowers barriers. Also consumer switching cost is relatively low. The barriers to entry in the natural and organic food industry can be

More about Whole Foods Case Brief

Open Document