Whole Foods Market wants to be a whole lot bigger.
Three years ago, Austin’s own Whole Foods set a goal of someday operating 1,000 stores in the U.S. The natural and organic food retailer recently upped that target to 1,200 — a 20 percent jump.
On February 12, co-CEO Walter Robb told Wall Street analysts that Whole Foods foresees crossing the 500-store threshold in the U.S. in 2017 and eventually hitting the 1,200-store mark. The announcement came on the same day that share prices fell by seven percent because of lower than expected earnings in the first quarter of fiscal 2014. Today, Whole Foods operates 373 stores in the U.S., Canada and the United Kingdom. A record-setting 107 stores are in the company’s development pipeline.
Jim Sud, executive vice president of growth and development at Whole Foods, said many markets in the U.S. “remain untapped,” giving the $13 billion retailer confidence that it can reach the 1,200-store goal.
Sud noted that Whole Foods is clustering stores closer together in urban markets like Boston, Chicago and San Francisco, offering the company more opportunities for growth. For instance, Whole Foods had planned to close its Gateway store in Northwest Austin after its new location at The Domain — two miles away — debuted in January. Instead, the company is remodeling the Gateway store and soon will reopen it.
“We need to keep the Gateway store open, and we think we are going to have, therefore, much bigger market share by having those two stores [rather] than just the one,” Sud said. “We are seeing that effect all around the country. It’s very exciting for us.”
Aside from grouping stores closer together in urban markets, David Lannon, executive vice president of operations at Whole Foods, pointed out that the company is expanding into cities like Jackson, Mississippi — a market that the retailer wouldn’t have imagined entering 10 years ago.
In the natural and organic grocery niche, “we feel like the market is continuing to expand — it’s a much bigger market,” co-CEO John Mackey said. “It’s true there is little bit more competition out there now, but the market opportunity is so much greater than it used to be. There is room for lots of players. We are the leader, and we’ve been the leader for a long time.”