What’s the Problem With Whole Foods Pricing?

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May 9 (Bloomberg) -- Culture of Profit Founder Rafi Mohammed and Chairman and Chief Executive Officer of the Hain Celestial Group Irwin Simon discuss organic foods and their outlook for Whole Foods Market on Bloomberg Television’s “Bloomberg Surveillance.” (Source: Bloomberg)

Both whole foods and starbucks were kind of early movers in their respective fields.

How is whole foods like starbucks as it tries to dig itself out of its problem?

Good morning, starbucks is a different experience.

This is an affordable pleasure every day and they are selling proprietary products as opposed to whole foods which is a shopping experience and they are selling other peoples products.

That is a big difference and that eliminates some insulation against price competition.

The key that whole foods need to focus on is changing its poor brand image with respect to price.

I know about your phd at cornell.

If you go to l myra, new york, will you tell me that overpriced organics will sell their?

I know they sell in boston.

Will they move in elmyra, new york?

I know erwin is focused on the growth of whole foods but as they grow into markets like l myra, they need to change the concept of that that whole foods concept may not resonate in some of the growth areas.

It's a common strategy that hotels use.

Erwin simon, you sell stuff to whole foods, do you sell more stuff to the kroger's and targets in walmarts of the world?

We have 2200 items in whole foods today.

We are their largest supplier.

Not everything is organic.

We sell a lot of natural progress in gluten-free products.

How many do you have a kroger?

We have 1700 products but there is 3300 kroger's around the world so there is more kroger's. at the end of the day, price is important.

If you go back and look on a percentage asis and cook -- and food costs, they keep rising.

And summers will make their choice on organic and i think it is so important the difference between price between conventional and organic is 15% and prices have gotten out of whack and i think what whole foods has to do is look at pricing and compare it to conventional products.

Erwin mentioned price and that is the biggest factor for most customers.

For whole foods customers, selection is what they determined as the most important buying decision.

As organics go mainstream and is whole foods tries to broaden its base, does whole foods need to reduce its selection?

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This is critical when you look at where whole foods goes in the next 12 months.

What does it mean for you if whole foods east to focus on price?

This text has been automatically generated. It may not be 100% accurate.


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