Organic-food competition hurts sales

Whole Foods dominated the American market for organic food for a long time. Now, companies like Kroger  and Wal-Mart have increased their range of organic products drastically. “Whole Foods continues to face challenges from competitors going after organic and natural foods more aggressively,” said Joe Feldman, an analyst at Telsey Advisory Group to Bloomberg.

Whole Foods’ strategy to cope with the competition includes cutting $300 million in costs and lowering prices. The company has also dismissed about 2.000 employees as part of their efforts.

Recently, Whole Foods also launched a chain of smaller stores called 365 by Whole Foods Market, which offers cheaper products and targets younger consumers. “Our 365 stores are firsts for us in so many ways, from a streamlined operating model, to centralized buying, to auto-replenishment of inventory,” John Mackey, co-chief executive officer of Whole Foods said in a statement. “We are already taking advantage of our many learnings to shape and evolve not just future 365 stores but Whole Foods Market stores as well.”