Whole Foods Market, a natural supermarket chain, was founded in Austin, Texas, in 1980. At the time, the market for natural, unprocessed foods was small, but the company soon expanded to new cities as demand grew. Now, the grocer can be found in 500 locations across North America and the United Kingdom. Since the beginning, responsible sourcing has been a core component of Whole Foods’ business.
This stakeholder orientation focuses on the needs of its customers, its employees, its communities, and people at every level of its supply chain.
The Whole Trade Guarantee is Whole Foods’ ethical trading program. It supports ethical trade, proper working conditions, and environmental protection in the production of the products it sells. Products with this label meet rigorous quality standards and come from certified farms that have a history of positive impacts on their employees, supply chain partners, communities, and the environment. Through the program, Whole Foods provides funds to the farms they work with to support various community initiatives such as community centers, medical services, and dental care. Programs such as Whole Trade support Whole Foods’ mission to nourish both people and the planet.
Whole Foods has often been called “Whole Paycheck”
because of the more expensive price tags on its products.
However, Whole Foods believes that, as a responsible buyer, it has a duty to monitor its impact on the environment and individuals throughout the supply chain. Pressure from retailers to lower costs can lead to farm owners exploiting workers to deliver products cheaply. One of Whole Foods’ goals is to provide its shoppers with affordable, sustainable food that also supports farmers and farmworkers.
Beyond creating win–win partnerships with its suppliers, Whole Foods ultimately views customers as its most important stakeholder. To differentiate itself from its competitors, Whole Foods emphasizes the quality of its products over price. The company has a variety of quality standards to ensure its customers get the best, including standards for its meat, eggs, seafood, supplements, beauty products, and household cleaners. In addition, Whole Foods bans more than 100 ingredients such as high-fructose corn syrup.
Employees at Whole Foods are another top priority.
Full-time team members are offered comprehensive health insurance. The company also provides its team members with career and learning development, volunteer programs through the Whole Planet Foundation, and team member assistance plans. In addition to competitive pay, the company also offers 401(k) plans and health savings accounts, discounts, and paid time off.
All of these efforts combined help Whole Foods earn profits, which in turn creates value for its shareholders.
Profits are essential for any business to survive, and Whole Foods believes it has a responsibility to its parent company, Amazon, to use its capital in the best way possible to achieve the best results possible. Not everyone was pleased when Amazon acquired Whole Foods in 2017 for $13.4 billion.
Many employees noticed a change in working conditions such as heavier workloads and budget cuts. Amazon also sought to make Whole Foods’ products more affordable by purchasing a greater number of products from national food distributors rather than local farms. Prices have since returned to pre-Amazon levels but other initiatives—such as discounts for Amazon Prime members—remain to provide customers with more value.
Whole Food’s strong relationships with its supply chain partners are fostered by its Whole Trade program. This is a core strength that can be leveraged by both Whole Foods and Amazon to stand out. Though many criticized Amazon’s acquisition of Whole Foods due to their cultural differences, Amazon’s deep pockets and robust supply chain knowledge will surely benefit Whole Foods in the long run. By committing to ethical and sustainable trading practices, Whole Foods sets itself apart from traditional supermarkets.

Questions
1. Why do you think Whole Foods wants to support the farmers and farmworkers in its supply chain?
2. Why are customers willing to pay a premium for goods at Whole Foods?
3. How does Whole Foods meet the needs of its customers?