Whole Foods Drives up Healthy Food Cost
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An article in the WSJ (05/07/2015) said what I had often suspected – there were reasons why Whole Foods items were more expensive and out of reach for many poor/middle-income people. The reasons have to do with the cost of doing business with Whole Foods; mandatory certifications to insure food meets their guidelines can cost at least $10,000 a year. One company was quoted as saying this represents %15 of their annual revenue. Someone has to pay this additional cost – the shoppers, since no food producer can absorb this significant sum and stay in business. Whole Foods has exercised clout over small businesses that can achieve instant success with placement at Whole Food’s over 400 stores. Whole Foods has an extensive list of over 80 unacceptable ingredients and has even asked companies to change their brand/company name. One company was even required to change to a pricier version of the preservative citric acid that was LESS chemically processed. Some agreements also require that product placement be exclusive with Whole Foods for a period of time (why you can’t find your favorite Chai Tea at Safeway’s). In related news, Whole Foods announced plans for a new store concept; a sister chain of smaller stores aimed at younger people with lower prices. Imagine that…..wonder what costs they are willing to lower to enable their suppliers to provide affordable prices?