Whole Foods is expanding into new markets (and unfamiliar territory) by moving into low-income neighborhoods. Can the company, often nicknamed “Whole Paycheck” for its high-end inventory (and prices) expect to survive in an area where residents can’t afford the usual Whole Foods price tag? Will the store thrive or starve?
Whole Foods Opens In Englewood
Whole Foods for years has focused on fresh, local produce and high-end, healthy foods to stock its shelves. With that freshness and quality comes a hefty price tag – which is why the company has always operated in high-end markets with disposable income. Now, the Austin, TX – based grocer is partnering with one of the poorest districts in Chicago as a testing ground to test the feasibility of Whole Foods in low-income areas.
But can it work?
Whole Foods Market has opened its latest Chicago location in the South Side neighborhood of Englewood, one of the most economically depressed areas of the city. The new store is the result of three years of collaboration between the grocer and community stakeholders and represents a bright hope for the community itself. Englewood residents and Whole Foods executives have held a two-way dialogue to make sure the new store doesn’t just reap profits from the community, but helps, as well.
Whole Foods spoke with residents, schools, local businesses, community groups, and nonprofits, and came to focus on ease of access for food, community engagement, and, above all, economic development and employment. There’s a lot of hesitation as to whether Whole Foods can survive in this environment, but so far the store is doing everything it can to live up to its word. The retailer worked with the community to identify 30 different dietary staples for residents, such as eggs, bread, and milk, will sell at a cheaper rate than other Whole Foods and even some other competitors. The store is also is donating food to community events and activities, and has awarded garden grants to eight Englewood schools to help build or enhance campus food gardens.
The question remains, can this work?
Absolutely. Whole Foods won’t have all the bells and whistles at the Englewood location. There won’t be a wine bar or gelato stand or some other luxury staples of high-end Whole Foods locations. But operating costs will be lower. As will the cost of rent.
Whole Foods is looking to show a business can make a profit and stay ingrained as part of the community. If this experiment proves successful, Whole Foods instantly gets a huge advantage over other grocers when looking to come to low-income areas. Support will be rampant and government subsidies will be plentiful. But as for how to gauge that success … Only time will tell.
Watch what Whole Foods Englewood store for us!
Keep an eye on the Englewood Whole Foods. If it does well, expect Whole Foods Market, Inc. (WFM) shares to make an excellent long term play.
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Featured Image Via Brandis Friedman/Chicago Tonight