Whole Foods Market, Inc. owns and operates the largest chain of natural and organic
food stores. Our Company mission is to promote the vitality and well-being of
all individuals by supplying the highest quality, most wholesome foods available.
Since the purity of our food and the health of our bodies are directly related
to the purity and health of our environment, our core mission is devoted to the
promotion of organically grown foods, food safety concern and sustainability of
our entire eco-system. Through our growth, we have had a large and positive impact
on the natural and organic foods movement throughout the United States, helping
lead the industry to nationwide acceptance over the last 25 years.
Whole Foods Market, Inc. is a Texas corporation incorporated in 1980. The Company
is based in Austin, Texas and conducts business through various wholly-owned
subsidiaries. Unless otherwise specified, references to Whole Foods Market or
the Company in this Report include its consolidated subsidiaries. We operate
in one reportable segment, natural and organic foods supermarkets.
We opened our first store in Austin, Texas in 1980. Our stores average approximately
33,000 square feet in size and approximately $28 million in annual sales. Our
stores are supported by regional distribution centers, bakehouse facilities,
commissary kitchens, seafood-processing facilities, produce procurement centers
and a coffee roasting operation.
Our goal is to become an international brand synonymous with not just natural
and organic foods, but with being the best food retailer in every community
in which we are located. We believe our heavy emphasis on perishable products
is helping us reach that goal, differentiating our stores from conventional
supermarkets and enabling us to attract a broader customer base. We believe
that all shoppers, not just natural and organic food shoppers, appreciate great
produce, dairy, meat, seafood, bakery and prepared foods, and it is our strength
of execution in perishables that has attracted many of our most loyal customers.
The Natural Products Industry
Natural foods can be defined as foods that are minimally processed, largely
or completely free of artificial ingredients, preservatives and other non-naturally
occurring chemicals and as near to their whole, natural state as possible. Organic
products are grown through methods intended to support and enhance the earth’s
natural balance. Generally, organic food products are produced using:
agricultural management practices intended to promote and enhance eco-system
health;
no genetically-engineered seeds or crops, sewage sludge, long-lasting pesticides,
herbicides or fungicides;
livestock management practices intended to promote healthy, humanely treated
animals by providing organically-grown feed, fresh air and outdoor access while
using no antibiotics or growth hormones; and
food processing practices intended to protect the integrity of the organic
product and disallow irradiation, genetically modified organisms (“GMOs”) or
synthetic preservatives.
Products
We offer a broad product selection with a strong emphasis on perishable foods
designed to appeal to both natural foods and gourmet shoppers. Most of our products
are from natural food vendors; however, we do sell a limited selection of conventional
national brands that meet our quality standards.
Quality Standards
A primary part of our Company mission is to promote vitality and well-being
for all individuals by supplying the highest quality, most wholesome foods available.
We evaluate quality in terms of nutrition, freshness, appearance and taste.
Our search for quality is a never-ending process involving the careful judgment
of buyers throughout the Company.
We carefully evaluate each and every product that we sell.
We feature foods that are free from artificial preservatives, colors, flavors
and sweeteners.
We are passionate about great tasting food and the pleasure of sharing it with
each other.
We are committed to foods that are fresh, wholesome and safe to eat.
We seek out and promote organically grown foods.
We strive to provide food and nutritional products that support health and
well-being.
Our standards require that seafood comes from deep, clean and clear waters
or from aquaculture farms where environmental concerns are a priority, and our
seafood is never treated with chlorine or other chemicals, which is common practice
in the food retailing industry. In addition, Whole Foods Market has championed
innovative production standards to improve the quality and safety of the meat
and poultry sold in our stores, while also supporting the better treatment and
health of the animals.
Animal welfare requirements currently mandatory for any meat and poultry sold
by Whole Foods Market include:
no antibiotics or added growth hormones;
an annual affidavit from each producer outlining the raising and handling practices,
feed, facility design, environmental conditions, employee training, medical
practices and animal welfare at the farm, in transportation and throughout processing;
annual inspection of each producer by Whole Foods Market; and
successful completion of an independent third-party food safety audit of each
processing plant and a humane slaughter audit according to a rating system developed
by renowned animal welfare and facility design expert Dr. Temple Grandin.
Competition
Food retailing is a large, intensely competitive industry. Our competition
varies from region to region and includes local, regional and national conventional
and specialty supermarkets, smaller specialty stores, and restaurants, each
of which competes with us on the basis of price, quality, service or a combination
of these factors. We believe our focus on quality and service at competitive
prices differentiates us in this segmented marketplace.
Natural and organic foods are one of the fastest growing segments of food retailing
today. Most supermarkets offer at least a limited selection of these products,
while some have chosen to expand their selection more aggressively. We believe
it works to our benefit for conventional supermarkets to offer natural and organic
products for two reasons: first, it helps fulfill our company mission to improve
the health, well-being and healing of both people and the planet, and second,
it helps create new customers for us by creating a gateway experience. As more
people are exposed to the benefits of natural and organic products, they are
more likely to become Whole Foods Market customers since we are the category
leader for natural and organic products, offering what we believe is the largest
selection and most informed customer service at competitive prices. We believe
our continued strong comparable store sales growth is evidence of the gateway
experience.