Whole Food Market - Essay Example

?Introduction This paper tries to evaluate the corporate performance of Whole Foods Market through identification of relevant issues about the said company. Furthermore, the proponent tries to analyze the identified issues. Considering that the Whole Foods Market is in its strategic management program, the proponent discusses its goal towards product differentiation and giving high value for customers. These two are then measured through the company’s financial performance. Identification of issues Whole Foods Market with its vision to become an international brand for natural and organic foods is also committed to become the best retailer in its community wherever it is located. In line with this, the company seeks to give significant higher value for its customers. This is evident in its core values in which there are two important points that are in line with quality of its products and giving the best for their customers (Whole Foods Market 6). Part of its core values is to sell highest quality natural and organic products available. Then there is a great detail of satisfying and delighting their customers. These are just some of the important values that they need to ensure in order to continue live and satisfy their vision. In the midst of this effort to focus on its vision, there are of course strategic issues that need to be taken into consideration. One of its essential goals in order to achieve its corporate goals is to continue grow its revenue. Furthermore, Whole Foods Market is also concern in educating the market with its significant definition about the quality of its product and service offerings. Thus, there are three essential issues that need to be understood at this point. The first issue is about its strategic move to highly differentiate its product and service offerings. The next significant issue is about understanding its customers and feeding them with the right information. Finally, the next consideration is its ultimate measure of success which the bottom line is to look closely at its revenue and generated profit. Analysis of issues Product and service differentiation There is a clear emphasis of this issue based on the vision of Whole Foods Market. In the first place, the Whole Foods Market is significantly trying to be a cut above the other by creating relevant changes in its service and product offerings. From its vision, it wants to become an international icon for natural and organic foods. Thus, as retailer it aims to give something new to its customers. However, it is not just enough to create something new for the customers, but there is a need to ensure a need for them. In other words, prior to providing something better in the market, Whole Foods Market should ensure that it has understood the prevailing demand or need of the customers. In the first place, there is going to be a challenge on the part of Whole Foods Market because it has to clearly define beforehand what natural and organic foods are all about. This is going to take enough of its time because customers need to be widely educated or well informed about its product offerings. In this level, the Whole Foods Market is trying to create a need for its product offerings in a way that there is a significant move to educate its customers. In today’s marketing activity, companies or organizations are able to successfully create a need for their product offerings. In fact, this is the basic and most common trend for them to be able to gain a high market share. Correspondingly, the Whole Foods Market needs to successfully create a need for its service or product offerings in order to successfully employ its product differentiation strategy. In this strategy, in order for it to be effective, the Whole Foods Market should try to promote products that matters to the customers. In other words, it is important that the needs of customers should be properly addressed. Fortunately, the Whole Foods Market is trying to establish a way to improve its customer service in the event of product assistance. It opens up its line through product communication and assistance via email, and contact with the local store. In order for this to be effective, the Whole Foods Market should be able to determine various concerns from its customers with regards to its service and product offerings. From its website, the Whole Foods Market is able to provide a way to create a closer contact with its customers. Such way is instituted for it to be able to determine what are necessary Customer satisfaction Next to providing quality is the goal of Whole Foods Market to ensure value for its customers. Its program for high customer service and quality products is in line with its goal to achieve customer satisfaction at a higher level. In this regards, Whole Foods Market is trying to define a concrete definition of its quality product offerings. The development of customer satisfaction is critical on the operation of Whole Foods Market because this is how it places value for its customers. Failure to fulfill customers with the satisfaction they need by meeting what Whole Foods Market promises to give them makes the entire strategic move of the said company null and void. Thus, its ability to hold on to its vision diminishes and there is a great possibility that it will never obtain its corporate objectives successfully. Therefore, customer satisfaction is tantamount to the achievement of the vision of Whole Foods Market. However, it is important to understand that such achievement is just an indicator of a job well done on the part of Whole Foods Market and its effort should continue for as long as it continue to hold on its vision. In its website, the Whole Foods Market is trying to define quality of its products and making it as a highlight in order to entice customers by catching their attention through what matters to them. Thus, it has become crucial in the step of Whole Foods Market prior to achieving customer satisfaction is to know its market segments. Remarkably, there is increasing number of customers who are most likely concerned about the foods they eat. Thus, these customers are the target segments of Whole Foods Market and its opportunity to satisfy them with their needs is timely. The entire strategy may not be sufficient without further consideration of the service. Thus, it is important that there should be integration of quality product and service in order to satisfy customers. On the part of Whole Foods Market, its ability to satisfy customers should increase the level of its effort to increase quality of both its service and product offerings. Financial analysis The following are figures obtained from Whole Foods Market Financial Report in 2010 (Whole Foods Market 7-8). Revenue - $9,005,794,000 Cost of goods sold - $5,870,393,000 Inventory -$323,487,000 In order for Whole Foods Market to survive in its industry, it is not just enough to be equipped with sophisticated management strategies, but there is also a need to achieve the bottom line. Financial consideration is always important and very crucial in every business. Thus, there is a need to evaluate how far the Whole Foods Market could address its expenses and still afford to manage its business. In other words, gross profit margin is relevant in finding this level of information. Below is the gross profit margin of Whole Foods Market in 2010. It significantly measures the profitability ratio of the company. Furthermore, it also implies how liquid the company is prior to achieving its vision in the future. The higher the gross profit margin of the company, the more it would likely to operate in the long term. Gross Profit Margin (%) = 34.81 Furthermore, there is also a need to investigate how efficient the Whole Foods Market in its inventory management. The information about days of inventory does not only show the efficiency of inventory management, but it would also particularly show how fast moving are the products offered by Whole Foods Market. Fewer days of inventory are considered better. Days of inventory = 20.25 Summary and findings The ultimate measure of Whole Foods Market’s success in its business operation is its financial performance. Its financial performance is relatively better, which is the ultimate result of its strategic advantage through product differentiation and a customer satisfaction at a high level. The gross profit margin which is significantly healthy plus a relatively shorter period for its inventory equals the opportunity for Whole Foods Market to substantially grow. It has indeed done a remarkable value for its customers through customer satisfaction and a significantly differentiated service and product offerings. Recommendations The Whole Foods Market has already begun fulfilling its vision and mission through its strategic moves. At the moment, its goal is to further enhance this achievement. This can be definitely implemented through its internal feedback mechanism that at the same time will measure its performance and strategic goals. However, the great portion of it should be for evaluating its ability to create customer value and improve or enhance its program for product quality and standard evaluation. References Whole Foods Market. Our core values. [online]. Available from: http://www.wholefoodsmarket.com/company/corevalues.php, 2011. [Accessed: 5th July 2011]. Whole Foods Market. Whole Foods Market Reports Fourth Quarter Results. [online]. Available from: http://www.wholefoodsmarket.com/company/pdfs/Q410financial.pdf, 2010. [Accessed 5th July 2011]. Read More