Whole Foods Sees Fewer Closures

Whole Foods might close down fewer Wild Oats stores than it had previously thought it would, one of Whole Foods' presidents said at an investor conference last week. After looking at the financial records of individual locations following the closure on the acquisition of Wild Oats last month, I am more encouraged by the potential of what we can do with those stores, said Walter Robb,

NEW YORK — Whole Foods might close down fewer Wild Oats stores than it had previously thought it would, one of Whole Foods' presidents said at an investor conference here last week.

After looking at the financial records of individual locations following the closure on the acquisition of Wild Oats last month, “I am more encouraged by the potential of what we can do with those stores,” said Walter Robb, co-president and chief operating officer. “I think we are going to keep more than we thought.”

He said Whole Foods would make its plans for the fate of individual locations known by the end of this month.

“We are moving really quickly,” he said. “We are well down the road with this in terms of cultural integration because we have been working on this for so long.”

He said the addition of new stores gives the company greater scale in several key markets, especially Florida, Denver and Seattle.

Asked about the small-format Whole Foods Market Express stores that Whole Foods recently said it planned to open, Robb said the stores would likely only be slated for metro areas where Whole Foods already has a presence.

“Some of the Wild Oats stores we are picking up are smaller stores, that lend themselves to a smaller format,” he said. “We think the No. 1 driver of consumer behavior today is convenience. We think strategically — being able to compete in more places makes sense.”

He also noted that a few of the planned new-store openings that Whole Foods has recently announced are in the 20,000-25,000-square-foot range, much smaller than the 60,000-65,000-square-foot stores it has typically opened lately.

Other topics he addressed at the Goldman Sachs 14th Annual Retail Conference included plans to enhance the company's private-label penetration, with a goal of achieving 25% of sales through the chain's “365” brand. He also said the company was working closely with suppliers to create more unique name-brand products exclusively for Whole Foods and was also working on some innovations in the food-service area.

In the wake of the acquisition, four top executives from Wild Oats Markets have left the Boulder, Colo.-based company, a spokeswoman for Wild Oats told SN. In addition to Gregory Mays, the former Wild Oats chairman who had also been acting chief executive officer and acting chief financial officer, other executives who have left include: Roger Davidson, senior vice president of merchandising and marketing; Sam Martin, senior vice president, operations; and Jon Payne, vice president of IT.

The Wild Oats spokeswoman, Sonja Tuitele, told SN that Whole Foods had not yet determined what to do with the Boulder offices. Whole Foods could retain the building as a regional headquarters if it can sub-lease some of the space, she said. Wild Oats has about 240 employees at its headquarters.

“There will be opportunities for our people with Whole Foods in this region, and possibly in other regions,” she said.

Whole Foods is sending a management team from its Austin, Texas, headquarters to run the Wild Oats operations.

“It will take them a few months to get a handle on how we support our stores, and then see what they want to do going forward,” Tuitele said.

Employees at some Wild Oats stores have already been told that the stores will soon be shuttered because of their proximity to existing Whole Foods locations. Last week, workers at Wild Oats in Portland, Ore.; Nashville, Tenn.; and Louisville, Ky., were told that their stores would close within 60-90 days.