Whole foods case

Examining external factors when developing or expanding a business strategy is probably one of the most crucial steps in achieving the business’s goals. Whole foods specifically were able to find a niche within the general grocery market. They were initially able to differentiate themselves from competitors by focusing on quality and innovation that allows them to charge a premium price for their products, which in turn gives them a competitive advantage over other grocery markets. When whole foods was just starting out there was not a huge market for organic or natural food as well the demand was also low.
The company saw a strategic advantage into getting into this sector is analyzing the specific industry environment. They saw little to no competition on entering into the niche market of natural and organic food products. However today the organic foods industry is growing and Whole Foods is finding itself competing hard to maintain their competitive advantage. Another factor that they are finding difficult to compete with is the transition of regular markets and discount retailers getting into the organic and natural food business. Other major competitors have popped up in the craze of natural and organic food sales with Trader Joes being one of the biggest competitors for Whole Foods. Trader Joes is able to capture a low cost structure, which allows them to offer competitive prices with quality products. This is offering many substitute items at a lower cost, which is very attractive to an economy that is in a recession and more careful about how they spend their money.
After the company was successful throughout the U.S. the company saw room for expansion outside the states and even a greater demand for organic and natural food in Europe. This is mainly because of their large population and a more sophisticated organic-foods market. By analyzing the country or national environment they were successfully able to expand into Europe.
The last factor