Coming on top of other recent bad press, a lawsuit filed against Whole Foods Market by People for the Ethical Treatment of Animals alleging the retailer’s animal welfare standards are “a sham” could be harmful to the retailer’s image, according to one analyst.
“Normally, we view most press investigations and/or lawsuits around food retailing practices as immaterial. But we note that this lawsuit does carry more risk than normal given the recent string of negative publicity regarding Whole Foods retailing practices that have impacted its franchise,” Andrew Wolf, an analyst for BB&T Capital Markets, said in a research note Friday.
Wolf noted that New York City’s Department of Consumer Affairs recently investigated Whole Foods for overcharging on items sold by weight, which dragged down the retailer’s third quarter same-store sales. Whole Foods also saw negative backlash after a customer social media post showing a store selling “asparagus water” for $5.99 received national media attention.
The PETA lawsuit claims Whole Foods’ animal welfare standards “differ little, if at all, from the industry’s paltry minimum standards.” The advocacy group recently filmed an undercover video at one of the retailer’s pork suppliers that allegedly shows abuse.
A Whole Foods spokesperson told the Washington Post that the retailer had followed up with the supplier in question immediately and found the farm met its standards for humane treatment of animals.
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