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COPYRIGHT 2006 All rights reserved. Reproduced by permission of The Condé Nast Publications Inc.
The share price of the Whole Foods Market, Inc., now stands at $62.49. Adjusting for stock splits and dividends, one share would have cost you $2.92 when the company opened on Nasdaq, in January of 1992, so it has done extremely well. Last year, its total revenue was more than $5 billion and its gross profit was more than $1.6 billion. In 2004, according to the Financial Times, Whole Foods was "the fastest-growing mass retailer in the US, with same-store sales rising 17.1 per cent quarter-on-quarter." Having opened in 1978 with a single countercultural vegetarian establishment in Austin, Texas, Whole Foods now has a hundred and eighty-one natural-food supermarkets, including many acquired in purchases of smaller chains: among them, Wellspring Grocery, in 1991; Bread & Circus, in 1992; Mrs. Gooch's Natural Foods, in 1993; and Fresh Fields, in 1996. In 2004, Whole Foods opened a fifty-eight-thousand-square-foot mega-mart in the new Time Warner Center, at Columbus Circle, with forty-two cash registers, a two-hundred-and-forty-eight-seat cafe, and three hundred and ninety employees. "Our goal is to provide New Yorkers with an engaging shopping experience and to become an integral part of this truly unique community," a company executive said. And in 2004 Whole Foods crossed the Atlantic, acquiring six Fresh & Wild stores in London and making plans to open others there under its own name. Its ambitions are global.
I like to shop at Whole Foods. Sometimes I go there just to see the variety and the colors: what new kinds of chard and kale will they have today? The employees--"team members," as they're called--seem reasonably happy and are often quite knowledgeable about the things they sell. A Wellesley graduate is one of the company's prize exhibits. "I just hang on to the fact that my job is good in some larger sense," she says on the corporate Web site. "If people buy the sprouts, they're eating healthier foods, the farmer is doing well, and it's good for the planet because they're grown organically." Since 1998, Whole Foods has ranked high among Fortune's "100 Best Companies to Work For in America." Although the company is as ferociously anti-union as Wal-Mart--John Mackey, the volubly libertarian founder and C.E.O., has called unions "parasites"--Whole Foods limits the compensation of its highest-paid executives to no more than fourteen times the employee salary average, and it likes to talk about how it rewards team members' initiative. Mackey once told Forbes, "Business is simple. Management's job is to take care of employees. The employees' job is to take care of the customers. Happy customers take care of the shareholders. It's a virtuous circle." Whole Foods gives people what they want, or, at least, the increasing number of people who don't blanch at the prices, which have earned the company the presumably affectionate nickname "Whole Paycheck": $3.98 for a five-ounce plastic box of Earthbound Farm organic baby arugula salad; $2.98 for six and three-quarter ounces of intricately packaged Earthbound Farm organic "mini-peeled carrots with Ranch Dip." For the price of the fixings for a modest family dinner at Whole Foods, you could just about afford one share of its stock. The motto of the great English supermarket pioneer Sir Jack Cohen was "Pile it high; sell it cheap." Whole Foods has shown the rewards that can flow from the opposite policy.
Whole Foods is only the most visible face of the newly confident organic industry. In February, Consumer Reports announced that sales of organic products had gone up twenty per cent a year during the past decade, reaching $15 billion in 2004--out of a total U.S. food system worth a trillion dollars--and that nearly two-thirds of American consumers bought organic foods last year, paying, on average, a fifty-per-cent premium over conventional foods. In March, Wal-Mart made the remarkable announcement that it would double its organic-grocery offerings...
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