Whole Foods Market will not expand its cheaper, smaller 365 store concept beyond the existing 12, all of which will remain open, according to a report.
The decision, which was relayed to employees in a memo from CEO John Mackey, as cited by Yahoo Finance, is based on a Whole Foods strategy to lower its prices.
“As we have been consistently lowering prices in our core Whole Foods Market stores over the past year, the price distinction between the two brands has become less relevant,” Mackey wrote last week. “As the company continues to focus on lowering prices over time, we believe that the price gap will further diminish.”
In a separate announcement last week, another Whole Foods executive said that the company intends to resume the expansion of its regular stores.
Whole Foods will resume expansion of its regular stores
The 365 stores relied heavily on private-label products, including 365 Everyday Value items. Since Amazon.com's acquisition of Whole Foods, however, many of those products have been appearing in the regular Whole Foods stores.
Amazon has empowered the chain to implement two rounds of price cuts (with a third cut now in the planning stages) and to resume the opening of stores, said Jim Sud, Whole Foods' vice president of growth and business development, at a retail real estate conference in Dallas last week.
By Edmund Mander
Director, Editor-In-Chief/SCT
