Come up with alternative strategies/ recommendations for the key issues listed b
ID: 424773 • Letter: C
Question
Come up with alternative strategies/ recommendations for the key issues listed below.
SWOT Analysis:
Strengths:
Good brand reputation
High quality standards
Leader in the natural and organic food market
Team based environment
“100 Best Companies to Work For”
Trendy theme of organic foods
Weaknesses:
High Prices
Depends mostly on the U.S. market
Limited suppliers
Only spends 0.4% of its total sales on advertising
Opportunities:
Expand globally
Lower costs and lower prices to be more competitive
Expanding supplier base
Spend more money of advertising
Threats:
Genetically Modified Organism(GMO) products
Lower prices from competitors
Climate change
Supermarkets offering organic products
Expenditure income in low
Key Issues:
Whole Foods is focusing too much on growth and not enough on growing sales
Competitors are offering lower prices. Not only are healthy and organic stores their competitors but supermarkets such as Walmart have started to sell organic products at lower prices
Whole Foods does not spend enough on advertising which can increase sales
Strengths:
Good brand reputation
High quality standards
Leader in the natural and organic food market
Team based environment
“100 Best Companies to Work For”
Trendy theme of organic foods
Weaknesses:
High Prices
Depends mostly on the U.S. market
Limited suppliers
Only spends 0.4% of its total sales on advertising
Opportunities:
Expand globally
Lower costs and lower prices to be more competitive
Expanding supplier base
Spend more money of advertising
Threats:
Genetically Modified Organism(GMO) products
Lower prices from competitors
Climate change
Supermarkets offering organic products
Expenditure income in low
Explanation / Answer
The results and recommendations for Whole Foods are as follows:
1. Export:
Top 3 global consumers the US(70%), Germany(18%), France(12%) are huge potential markets for the sale of the produce. They should not just focus on domestic sale but grow in the overseas market as well. Therefore, other than the US market they should expand in other two countries as well.
2. Outsource Production:
The production in 178 countries (prominantly India, Mexico, The Philippines) having production CAGR 16% should be focused on. They can outsource the production in these countries where the land rate is less and the cost of labor is affordable. They can have good sale prospective in countries with good demographic dividend where population under the age of 25 are growing more health conscious.
3. Marginal price cut:
They have high customer loyalty due to premium quality. Just by a marginal cut in the prices of the goods the company can capture a wider market share which would rapidly increase its revenue. It would be able to overtake its competitors by having both price and quality advantage.
4. Increase advertising budget:
It is important for the company to increase their advertising budget to increase the awareness about the brand. They should start campaigns associated with the benefits of organic displaying their USP of premium quality.
5. Tie up with online player:
They should tie up for the sale of their products through online giants which would increase their revenue.