Whole Foods Market’s third quarter total sales, covering the 12 weeks to July 7, increased by 12.1% to $3.1bn, with comp sales increasing by 7.5%. Net income increased by 21.4% over the period to $142m.
Committed to improving promotional activity and relative price positioning
Whole Foods Market continues to demonstrate strong sales momentum reflecting the focus which it has placed on improving its value proposition and focusing more on health and wellness. The increase in comp sales was driven by an approximate 4% increase in transaction count and 3% increase in basket size. Going forward, Whole Foods Market is committed to expanding its value offer across the store through increasing promotional activity and improving its relative price positioning. To date the investments in pricing have been offset by improvements in shrinkage and inventory control, although gross margins may be impacted in the future.
Value strategy brought to life in Detroit
The retailer’s recent new store opening in Detroit saw a new value strategy being implemented in fresh foods, including more pre-packaged ranges. Ahead of the store opening, Whole Foods Market ran classes in community centres focusing on how to cook and buy whole grains, beans and produce, while also highlighting its 365 private label
range. This urban-based store has been well received by shoppers and a similar store will be opened in New Orleans later this year. In addition, elements of this value strategy will be replicated in selected markets across the US.
1,000 US stores in its sights
With 94 leases in its development pipeline, the retailer reiterated its target of opening 1,000 stores in the US alone. With recent openings covering a broad range of store sizes, including its smallest US store at 8,000 sq ft, the retailer has increased flexibility in terms of format development which enables it to target a much broader range of catchment areas. With 24 new stores already opened this year, a further 12 will open in the final quarter of its financial year.