3. The Five Forces
Rivalry of Sellers – The organic and natural foods segment contained between 12,000 and 13,000 local and regional, independently owned and operated stores and chains. Typically, these are either single stores or chains with only a handful of locations. …show more content…
In fact, Wal-Mart made an arrangement with the owners of Wild Oats, the company that WF failed to acquire, and began selling Wild Oats products on its shelves in spring 2014. While it is not stated in the case, it does not appear that competitor companies are spending large sums of capital to campaign and advertise to new customers. The fiercest competitors of WF are, however, striving to differentiate themselves from WF. Additionally, these grocers are rapidly trying to expand their hold on the market by increasing the number of stores and territories they occupy. Competition for this factor is …show more content…
The atmosphere within their stores, locally sourced produce, and specialty goods all command a premium price. Trader Joes has gone the opposite direction and kept cost down by selling their exclusive line of organic and natural products. They can appeal to the needs and wants of shoppers who want to eat healthy but cannot afford the “whole pay check” prices of WF. Wal-Mart is not the typical organic grocer and as such offers a limited offering of products. One might speculate that Wal-Mart is introducing organic products to their highly price sensitive shoppers with the hope that as market conditions change, their shoppers will be ready to change with already familiar brands at everyday low prices. It appears that differentiation among rivals is moderate. As the demand and market grows for organic foods, different retailers seem to have gone in pursuit of their own