For quite some time now, Whole Foods Market, Inc.WFM has been working on lowering prices, upgrading technology and containing costs. The company's recent decision to reduce its workforce by 1,500 people over the next eight weeks is seen as a part of this strategy. This reduction will entail nearly 1.6% of the company's total employees.
Although Whole Foods added 9,000 new jobs over the past year and 35,000 jobs in the last five years, the company's business performance has been disappointing. The company's shares have declined 39% year to date due to its dismal top-line performance. The top line has missed the Zacks Consensus Estimate for eleven consecutive quarters. Analysts believe that stiff competition and allegations of overcharging some pre-packaged foods are the headwinds which the company is combating at the moment.
More companies are entering into and expanding their presence in the Organic & Natural food business due to customers' inclination toward fresh and organic products. The mainstream supermarket chains such as The Kroger Co. KR , Target Corporation TGT and Wal-Mart Stores Inc. WMT are offering customers natural and organic foods at a much competitive price.
In an attempt to shed its reputation of "Whole Paycheck" and to stave off competition, Whole Foods plans to introduce a "uniquely branded store concept" - "365 by Whole Foods Market" in 2016, equipped with innovative technology, compelling products at value prices and a much modern look to target millennials.