on the cheap end of its 52 wk range. I like this company a lot and what they offer the consumer, especially compared to other grocers you have peace of mind knowing what you bought had a limited impact on the earth, but more importantly avoids artificial ingredients and harmful pesticides As a novice investor, what’s important to know about the grocery industry and what main drivers should i look for?
Thin margin business, cut throat. Relies on the ability to pass on inflation immediately to consumers. I hate the industry. I’d rather grow the food.
What he said.
Pricing competition between grocers is huge. Whole foods got away with outrageous pricing for years, and in some markets they still do, but there are “high end” brands entering certain markets with every day low price models. Also didn’t they have accounting issues recently?
I’m pro-pesticide, pro-hormone and pro-genetic tinkering when it comes to my food supply. Paying $5 for a pound of peaches that look worse, taste worse and delivered lower yields isn’t my idea of a good time. I’ll likely die of some sort of cancer and/or heart disease, but life will taste good doing it.
Sopabox aside, I think whole foods is on borrowed time. Razor thin margins, increased competition in “mainstream” grocers and a serious threat from cheaper substitutes whenever their core customer base feels a pinch at the purse strings/wants to mingle with the proletariat.
Lots of consolidation in this space. So you could invest hoping for a takeover. Investing in the business itself seems like a poor decision. Commodity play at heart.
Also, many of us call it ‘whole paycheck’ because they are so fxcing expensive.
More like Whole Paycheck, amirite guys? Guys?
I eat at Whole Foods all the time, super cheap. You just grab some chicken or cheese or an apple and walk around eating it while you shop for cheap stuff, like flowers for the wife, and scarf down tons of free samples. Delicious.
whats the cost of lunch there in nyc?
^ Lunch in NYC depends, but I can get by at various deli and sandwhich joints for $8-11.
Organic/healthy food grocery retailing used to be more of a niche business, but the industry has seen rapid growth and an influx of competition because of the much higher margins (still a low margin business but much higher margins than traditional grocery store retailing). Now you have Trader Joes, Fresh Market, Sprouts, Natural Grocers and they are all building new stores sometimes right next to Whole Foods. Even Wal-Mart and traditional grocers now stock “organic” items. Basically this industry has become more main stream and competition is more intense. These stocks were trading at absurd multiples because of their growth potential and it was only time before they came back to earth.
nah i meant at whole foods? last time i stopped by i spent 13 bucks on some salad…felt like a lot
It must’ve been because they price to go orders by weight. How much lettuce did you get?
I actually think the declining margins and increased competition can be a good thing - they’re becoming more competitive with typical grocers who are trying to compete with WF, like Walmart, while still maintaining their competitive advantage - that is peace of mind to the customer that everything they walk out with is completely natural and hormone pesticide you name it free. Yea the landscape is very competitive, and margins are decreasing. I would argue they are still the leader in this niche offering and don’t believe they’re future growth plans have been significantly impacted. Maybe optimistic thinking especially for the medium term
Where I am, the grocery competition is insane and it’s great for consumers. They’re all piling on top of each other and new people are joining in. Within 2 miles of my office, we have 7 different chains: a Fresh Market, a Kroger, a HEB (best grocery store ever), another local chain, a Trader Joes, a Randalls (Safeway), and TWO Whole Foods. Further out to the suburbs Aldi is opening stores too.
It’s a rough business and the money comes in differentiation. Unfortunately that’s gone for WF now. Safeway, Kroger, Albertsons, et al are in a commodity business. I actually went into WF last night for the first time in about a year and it was to see if they had a limited distribution local beer that my normal liquor store had run out of. They did, so I bought there but that was it.
^ Then throw Wal-Mart into the mix too. And Amazon. Sheesh, what a crappy business to be in for a small player.
^ Walmart/Sams and Costco have unveiled a whole different dimension to food retail. It’s amazing how much cheaper I can buy certain things at Costco/Sams vs. the grocery store, particularly if its on sale at the former.
When I lived in a city that was more of a food desert - our one main grocery store was stupidly expensive - I did most of my grocery shopping at Walmart. I don’t anymore because I have better options and going to Walmart simply hurts my soul, but I recall being able to get good prices on most things. My inner fat ass would always raid the “day old” bakery cart for half off cookies and cinnamon rolls.
They’ve also help upend gasoline retailing, but that’s for a different thread…
I bought the best grass-fed bison tenderloin of my life at Whole Foods. Cooked it up med rare in a cast iron skillet with grass-fed butter from France (where else?). Instant doubling of testosterone. Ahh, still fantasize about that steak…
I am surprised that some bigger company does not buy Whole Foods to diversify its business. Maybe the corporate overlord model might not go over well with those yuppie hippie customers.
Plus the guy running it is a yuppie hippie clown to begin with.
You know you are from Texas when you are rocking the HEB
I’m seriously considering buying this stock after tasting their Pineapple Basil Sorbet (This is clearly indicative of genius management, I mean who would think of putting pineapple and basil into the same dessert?). This store is awesome and has great cheese samples!
http://www.huffingtonpost.com/2014/09/19/whole-foods-salad-bar-win-it-you-can_n_5844160.html
The Whole Foods Marketsalad bar is the land of milk and honey (but more like the refrigerated aisle of tabouli and chicken salad) for lunchers with enthusiastic taste buds. Yes, there’s much beyond traditional salad ingredients to devour at this dining utopia. But with so many options and a steep price tag, it seems to be a salad bar for the elite.
New York City’s Union Square location charges $8.99 for a pound at the self-serve bar, which means financially-conscious consumers have to be smart about exactly which ingredients go into their salad box. It is possible to buy an average-priced salad that is filling and tastes good – it just takes a little thought. (From experience, I know that a reckless free-spirited diner can accidentally compose a salad costing more than a sushi dinner.)
We took a jaunt to this very salad bar to prove affordability is feasible. Below you will see an example of an expensive, brashly-made salad (dumb salad) and a reasonably priced, calculated salad (smart salad).
12 Ways Not To Spend Your Entire Life Savings At The Whole Foods Salad Bar
“Winning” the Whole Food salad bar, as you see, doesn’t mean eating weightless lettuce for lunch. But considering food density is key: The heavier your salad, the more you will pay. It’s just as important to examine how cost-effective the items are. Would it be cheaper to buy the ingredient elsewhere, outside of the salad bar? If the answer is yes, that item probably doesn’t belong in your little brown box. Here are a few things to remember for your future smart salad journeys:
Do not get hard-boiled eggs. Do not. Eggs are a wonderful lunch choice – they’re filling and packed with protein. But selecting hard-boiled eggs from the salad bar is foolish. They are heavy in weight and take up a lot of space. Instead, you could buy a dozen eggs for less than three dollars at a local bodega (but probably not at Whole Foods), boil them all and distribute them in your salads throughout the week. That would be smart.
Resist the heavy veggies. Similar to the egg predicament, many tasty vegetables can be purchased outside of the salad bar for much less. (If you’re really pinching, a frozen bag is often less expensive.) That vibrant, green piece of broccoli may entice you, but its high water content will weigh down your container. Keep other individually served vegetables and fruits that take up a lot of surface area – like cauliflower, cucumbers, tomatoes – out of the box, too.
Choose the “fancier” veggies instead. Olives, artichokes and roasted red peppers can cost a pretty penny when sold on their own. The salad bar is an equal opportunity vendor, so plop a few of these more gourmet-seeming vegetables to get a better bang for your buck.
Don’t get carried away by novelty. When, besides at the salad bar, do you get to combine your cross-cultured love for stuffed grape leaves and seaweed saladin a single dish? It can be tough to resist packing every intriguing mix-in into your salad, but if you’re not careful, the ounces will rack up. If you are easily excited by variety, inspect the entire bar and walk a full lap before making any selections. You’ll be less likely to indulge the kid-in-a-candy store-turned-adult-at-the-salad-bar that you are.
Fruit salad is the forbidden fruit. You may choose whatever salad bar fixings you crave, of course, but that colorful bin of fruit salad is just another substantial mass to your box. You’d save more by purchasing an additional prepackaged side of fruit salad or, better yet, a single apple.
Load up on nuts. Whole Foods’ salad bar is rife with nuts like cashews. almonds and walnuts that tend to be pricey when sold on their own. Top your salad with a melange of these and reap the many benefits of the near-weightless snack while beating the salad bar system.
But skimp on beans. Beans – the mushy types like kidney and cannellini, in particular – are dense and will sink to the bottom of your box. If you need a bean fix, buy them canned.
Do add cheese. This is good news. When you add cheese, you’re definitely milking the salad bar system. The bar presents a bounty of cheeses; when possible, choose the shredded or grated cheeses over the cubes (it’s all in the weight, people). Even still, if a square of feta is singing your song, welcome it to your salad box. Avoid scooping up the salt water solution along with it.
Get the small container. When it comes to portion control at the salad bar, Whole Foods hands you the reins.No matter your hunger level, you’re more likely to fill a bigger box with more food (and underestimate how much you’re taking). In all likelihood, you will be satisfied by what you fill in the small box, and you’ll spend less, too. Win.
Go for shredded. Again, density is the fundamental principle for navigating the salad bar. When presented with shredded carrots or baby carrots, choose the former. You’ll be able to enjoy the taste of carrots without sacrificing as much cash.
Take your dressing on the side. Kindly ask one of the Whole Foods employees for a small dressing container. Dousing your greens in creamy ranch before check out will add unnecessary ounces to your salad’s weight.
Be mindful of the marinade. If you’re craving something from specialty salad section – like the golden sesame tofu that comes in a thick soy glaze – use precision to pick out the pieces from their marinade. Your items will retain the flavor of whatever they’re dressed in, but you won’t have to pay for the excess saucy stuff.