You may never have heard of Whole Foods Market, but you have almost certainly seen inside one. The US chain of organic supermarkets is a favourite with film-makers: in any romantic comedy where a cute but lonely girl bumps into a cute but lonely guy, while serving themselves at a grocery store salad counter, the chances are the scene was shot in a Whole Foods Market.
The chain appeals to liberal, middle-class America because it seems to offer guilt-free shopping. The business started in 1978 with a single vegetarian store called Saferway in Austin, Texas, where one of its founders, John Mackey, was living in a vegetarian co-op. At first, hippies and college students were its main customers. But, in 1980, following a merger with another local natural foodstore, Whole Foods Market was born and the chain has grown rapidly, even though, when the company’s 12 out lets floated on the Nasdaq in 1992, Mackey commented that 100 stores would saturate the US. At the last count, it owned 190, including 20 in Los Angeles, a megamart measuring 58,000 sq ft in the Time Warner Centre in New York and a flagship übermart in Austin, Texas covering 80,000 square feet.
Despite its size, Whole Foods Market portrays an idealistic version of green consumption. For instance, it has a company policy on sustainable fishing (no stocks from overfished Chilean seas), the Californian stores use solar power, and newer stores pioneer building techniques using recycled mat erials. Since 1998, it has ranked high among Fortune’s 100 Best Com panies to Work For in America. Its highest-paid executives earn no more than 14 times the employee average and John Mackey recently cut his salary to $1 a year – saying he had earned enough money.
These strictures haven’t hurt business. Quite the contrary. In 2006, Whole Foods Market turned over more than $5.6bn (£2.9bn) and it’s growing all the time. In June, the company opens its first UK supermarket in London, in the old Barkers of Kensington department store building – which heralds a major move into the UK and ultimately continental Europe. (It bought the London-based natural food chain Fresh & Wild in 2004.) The advance publicity is already building, with enthusiastic coverage in London’s Evening Standard and four pages of analysis in the Guardian‘s G2 section.
Whole Foods Market would seem to be a beacon for the future – a multinational that’s good for the environment and pays decent wages. And yet its arrival on these shores has opened fissures in the green movement, which will widen as environmentalists and politicians of all parties seek to address a fundamental issue: is business capable of providing a solution to the environmental crisis?
“Actors in the sustainable food movement have to balance out three concerns,” explains Andrew Simms, director of policy at the New Economic Forum and author of Tescopoly: how one supermarket came out on top and why it matters. “There are concerns about the health and wellbeing of the local economy, concerns about the environmental sustainability of the food system, and classic economic concerns about competition in the market. There are some who basically believe all organic is good whoever it comes from, but it’s far more complicated than that.”
The UK’s organic lobbying body, the Soil Association, welcomes Whole Foods Market. “The organic market in Britain is booming and Whole Foods Market’s move is testim ony to this,” says Soil Association spoke s woman Victoria Record. “Whole Foods Market’s arrival may mean that people who weren’t already buying organic food will now do so – and may move on to a local box scheme or farmers’ markets.”
At the same time, the chain has faced increasing criticism in the US for swallowing up smaller organic stores, encouraging the growth of large organic farms at the expense of smaller competitors and refusing to deal with trade unions. Whole Foods Market workers in Madison, Wisconsin, caused a stir four years ago when they voted to join a union, but the company persuaded them to back down. In a 2005 interview in the Economist – title: “A Wal-Mart for the Granola Crowd” – Mackey said he disliked the “adversarial nature” of unions, describing union thinking as a “zero-sum mentality” in which “if shareholders are winning, labour is losing”. The market, he said, is the “best check against exploitation, as people can vote with their feet”.
Costs in fossil fuels
Some observers see little difference between Whole Foods Market’s supplier relationships and those of any other large chain. The company’s main supplier of lettuce in the US, for instance, is Earthbound Farm. Earthbound’s founders Drew and Myra Goodman now supply 70 per cent of all the organic lettuce in the country from 26,000 acres of land in California, Arizona, Colorado and Mexico. Earthbound’s website says that its farming techniques cancel out the need for more than a quarter of a million pounds of chemical pesticides and almost 8.5 million pounds of synthetic fertilisers, which saves 1.4 million gallons of the petroleum needed to produce those chemicals. Their tractors even use biodiesel fuel.
The centralised nature of Whole Foods Market’s buying and distribution means, however, that growing, processing, and shipping one calorie’s worth of lettuce to the East Coast costs 57 calories of fossil fuel – indeed, the whole supply chain from California to Manhattan uses only 4 per cent less fossil fuel than that of a conventionally grown Californian lettuce. In his book The Omnivore’s Dilemma: a natural history of four meals, the American writer Michael Pollan quotes one consumer advocate’s attack on Whole Foods Market’s “Big Organic” approach: “Organic is becoming what we hoped it would be an alternative to.”
In the UK, Friends of the Earth has been battling exactly this kind of supplier/distribution relationship for years. In 2004, FoE took the Office of Fair Trading to court to force it to investigate the big four supermarkets – Tesco, Asda, Sainsbury’s and Morrisons. “In 2000, the Competition Commission said that a market share of just 8 per cent could distort relationships with suppliers and give a supermarket too much buying power over producers,” explains Vicki Hird, senior food campaigner at FoE. “Tesco has 30 per cent of the market while Asda and Sainsbury’s – which may merge – have 15 per cent each. Even if they all honour their green claims, this can’t be the solution – what we need is a diverse local economy keeping money in the community and rewarding producers and consum ers. We’re not anti-growth – we’re just looking at the quality of growth and we don’t believe the chains’ responsibility to shareholders means they can achieve this without substantial government intervention.”
FoE – and Tescopoly author Andrew Simms – fear that Whole Foods Market’s arrival will become the model for the growth of sustainable food at a critical point of green enthusiasm from consumers. With the chain’s voracious appetite for expansion and its desire to deal with large producers, it will be hard for new entrants to the market to behave in any other way. “In the kind of Anglo-Saxon market we live in, we have to work out how to regulate vigorously enough to keep monopolistic companies – those with more than 8 per cent share – focused on the environment once the fashion has passed,” says Hird. In other words, a change ain’t gonna come if we leave them to it.
Whole Foods Market’s North Atlantic president David Lannon, who’s overseeing the opening at Barkers, dismisses these concerns: “Some parts of the green movement just think that anything small is cool and anything big is bad,” he says. “When we first opened in Manhattan we were hip; now we have five or six stores [there] suddenly we’re bad. But we’re no longer just about hip urban centres. Our last store opening was in Birmingham, Alabama, the sort of place you wouldn’t have considered finding an organic supermarket when I joined the company 21 years ago. Now I don’t think there’s anywhere in the world we couldn’t open.”
A short history of organics
Jamie Oliver opened the first organic training school for dinner ladies in 2005.
Organic food is eight times more likely to harbour bacteria.
Cox’s apples can be sprayed up to 16 times with 36 different pesticides.
The government wants 70 per cent of domestically sold organic food to be produced within the UK by 2010.
The European Commission proposed that up to 0.9 per cent GM contamination should be allowed in organic food.
200 million litres of organic milk are sold in Britain each year.
It takes an average of five years for a farm to convert to organic status.
Research: Rebecca Bundhun and Sarah O’Connor