Whole Foods: A Luxury Grocer in Detroit?

Mar 4, 2014

Whole Foods: A Luxury Grocer in Detroit (pdf abstract)

Purchase the full report on GlobaLens (Case study # 1-429-371)– published 02/2014, 16 pages.
Developed by: Claire Boland, Heping (Cindy) Fu, Kristine Schantz (’16), and Daniel Voce-Gardner (’14) under the supervision of Andrew Hoffman

DESCRIPTION: The “Whole Foods: A Luxury Grocer in Detroit?” case describes the various considerations store manager, Larry Austin, must make when the co-CEO requests a report on whether targeting store locations outside of the normal company demographic is advisable. In light of the Detroit Whole Foods’ success and the company’s plans to expand, evaluate the effectiveness and appropriateness of Whole Foods’ recent strategy to target low-income, urban communities as part of its store development plans. Furthermore, the case poses additional topics to consider: (1) How will expanding into these new areas transform Whole Foods’ brand image? (2) Is it Whole Foods’ role to address food access and poverty? (3) Does moving into low-margin areas negatively impact the bottom line of the company and its shareholders? This case was written by graduate students Claire Boland, Heping (Cindy) Fu, Kristine Schantz, and Daniel Voce-Gardner under the supervision of Professor Andrew Hoffman.

TEACHING POINTS:

    After reading and discussing this case, students will be able to:

  • Evaluate whether Whole Foods Market is actually facilitating food access to low-income neighborhoods or taking advantage of a business opening.
  • Evaluate the business decision to enter low-income areas, considering both the “business bottom line” versus “business triple bottom line” debate and the role subsidies played in the company’s decision.
  • Establish whether or not the Detroit model is replicable in other cities of similar demographic backgrounds, specifically Chicago’s Englewood neighborhood.
  • Explore the social justice issues surrounding the move: Is Whole Foods taking advantage of food insecurity (lack of access to quality food), and is access to quality food a basic human right that Whole Foods Market should be providing to all communities?
  • Determine who the key stakeholders are and who is benefiting from the new Whole Foods store: Is it the local residents, as the company claims, or will this move lead to gentrification negatively impacting the current community?