Whole Foods misses the whole picture - and loses £36m

We’ve said it before, we’ll say it again – at times like these, it’s the Primarks and the Pradas that survive. The super-luxe end of the market, and the bargain basement. For the masses, turning to the cheapest options available on the high street is the only sensible way to handle job losses, reduced bonuses and all-over worry that next month there might not be a pay cheque. (While for the lucky loaded few, losing a million on one of their multiple businesses really isn’t troublesome enough to take but a nibble out of their Cartier in-store credit.)

So it is that the British public have shied away from their infatuation with all things organic, ethical and made by Sri-Lankan goats who learned pottery in a women’s refuge funded by a Botswanan nuns’ theatre. Much as the fashion was to decry any ingredient suffixed by an E, any plant that had been within 10 miles of an anti-bug spray and any turnip that had traced its roots but within an inch of chlorinated water, when the recession struck, it just all became a bit too darn costly.

Consequently, last year organic food sales had dropped more than they had at any other time in the previous decade. And now, the British arm of super-organic super-healthy super-chain Whole Foods is feeling the rot of unbought veggies, with a £35.9m loss in the last year.

That said, it has emerged that a dip on organic food obsession isn’t, in fact, the only thing that’s caused such damage to the chain, which came over from the US in 2007 and set up shop first and foremost on London’s prime real estate High Street Kensington.

If reports from last night’s Thelondonpaper are to be believed, which well they may be, the chain made a series of fateful errors that left it in the lurch on this side of the pond.

The paper wrote: “Analysts believe the site is too big [the High Street Kensington branch is 80,000 sq ft] and does not have enough car parking. The company initially tried to run the store from the US, but it has had to parachute in one of its top US executives.”

Oh dear. Too much rent, not enough provisions for customers, and a shockingly weak and inattentive management strategy. Bad, bad, bad. What of customer research? What of considering the most basic of basics of buying premises? What of the fact you always, always need a manager who can, if not be at the premises, reach them within minutes whenever needed?

Obviously realising its mistake, Whole Foods, which has also bought up the Fresh & Wild chain with branches in several cities across the UK since arriving here, has at least begun to undo its sloppy decisions. The Independent reports today it has now closed its Bristol store, and has put 15-year-long company veteran Jeff Turnas in place as UK regional president.

Turnas said yesterday: "Whole Foods Market has been making changes and improvements to the Kensington store, and we have been pleased with the positive reactions we have been receiving from our customers. We plan to continue to make these types of changes at our UK stores as well as continue to aggressively look for additional store sites in London."

Thelondonpaper pointed out expansion could in fact help the chain in the UK, ‘as a bigger scale would mean it could source products in Britain, instead of having to import many from the US’. (As a side note, though, we’re not entirely comfortable with the store’s seemingly ethical and eco-friendly credentials sitting alongside the needless pollution and carbon emissions that constant importing from the States must be causing.)

So we shall see what happens. But it just goes to show that even if you have a strong, profitable brand in one country, you can’t just go rolling out exactly the same idea in another and expect it to work, without incredibly careful planning, research and managerial structure in place. Because if it was that easy, we’d all be doing it.
 

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