Whole Foods Market “ Whole Foods, Whole People, Whole Planet ”

1. Whole Foods Market“ Whole Foods, Whole People, Whole Planet ” Hiroko Takashima

2. U.S. sales of organic food and beverages is growing • U.S.sales of organic food and beverages: $26.7 billion in 2010 (cf. $6 billion in 2000) • Represented 7.7% growth over 2009 sales • Approximately 4% of U.S. overall food and beverage sales in 2010 • Over 11% of all U.S. fruit and vegetable sales

3. Whole Foods Market : Products & Services • Founded in 1978 and is headquartered in Austin, Texas. • Operating natural and organic foodsupermarkets • Operated 316 stores(as of November 2, 2011) • the U.S. (303), Canada(7), and the U.K(6) • Annual sales: $10 billion in 2011 • Full Time Employees: 48,200 [Shop sketch image]

4. Whole Foods Market : Features 1. Specialty for natural and organic foods • Good partnerships with vendors and suppliers • Make a plan to open 1,000 stores in the U.S. in the future (CEO Walter Robb said) 2. Team Member Happiness • Ranked for 15 Years onFORTUNE's "100 Best Companies to Work For" List • Provides health care at no cost to full-time team members • All employees (except temporary) are eligible to receive stock options • High salary (ex: Associate Store Team Leader $80,199/annual average) 3. Satisfied and Delighted Customers • Rely on word-of-mouth recommendations from the shoppers • Connect with the customers through social media websites

5. Features: Team Member Happiness • FORTUNE's "100 Best Companies to Work For" List 2012 http://money.cnn.com/magazines/fortune/best-companies/2012/

6. Features: Satisfied and Delighted Customers 1. Rely on word-of-mouth recommendations from the shoppers • Spend much less on advertising and marketing,About 0.4% of the total sales in fiscal year 2010 2. Connect with the customers through social media websites,in addition to e-newsletters, the corporate website and blog • Over 2.1 million followers on Twitter • Over 780,000 fans on Facebook • Many stores have set up their own Facebook and Twitter accounts http://www.facebook.com/wholefoods

7. Competitive Comparison in Financial Statement • Competitor: Kroger, Safeway • [Strength] • Big enterprise scale • [Weakness] • Lower revenue growth and lower margin, even less than the industry average • Whole Foods Market [Strength] • Higher revenue growth rate • Much higher margin [Weakness] • Very high P/E ratio Source: Yahoo finance Direct Competitor Comparison (as of January 23, 2012)

8. Whole Foods Market: Stock Chart (for 2 years) • The stock price (WFM) is going up with some fluctuation. Raises FY 2011 Guidance; Raises FY 2011 Comparable Store Sales Guidance Raises FY 2011 EPS Guidance Source: Yahoo finance (as of January 23, 2012)

9. Stock Chart Compare to Major Supermarkets(for 2 years) • WFM stock price increased by over 150%(even though Costco increased by 50%) • Other competitors’ stock prices fluctuated or remained steady Whole Foods (WFM) Costco Kroger Wal-Mart Safeway Source: Yahoo finance (as of January 23, 2012)

10. Conclusion: • Q1: Is Whole Foods Market undervalued or overvalued ? • My opinion : In the long-term view, “valued price” • Analyst opinionis below Source: Yahoo finance as of Jan.25, 2012, Data provided by Thomson/First call

11. Conclusion: • Q2. Now is it a good time to buy Whole Foods Market ? • My opinion: Yes! Why? 1. Organic foods sales growth ($26.7 billion in 2010 <- $6 billion in 2000) 2. The company’s high growth performance and high margin (+1,000 stores in the U.S plan) 3. Employees’ great commitment (15 Years on FORTUNE's "100 Best Companies to Work For" List) • Analysts opinion is below Recommendation Trends Source: Yahoo finance as of Jan.25, 2012, Data provided by Thomson/First call