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The Walmart Of Organic

(from the family farmdefenders.org site) Whole Foods is the largest retail giant in the natural food sector in the U.S. with 168 stores nationwide (plus in Canada and Britain) and annual gross sales now exceeding $4.6 billion. In fact, Whole Foods has grown twice as fast the leading corporate grocer, Walmart, over the last four years. Started in a humble storefront at the corner of 8th and Rio Grande in Austin, TX back in 1978 by self-described “free market” libertarian and current CEO, John Mackay, Whole Foods grew parasitically throughout the 1990s by absorbing its competitors: Bread & Circus, Fresh Fields, Merchant of Vino, Mrs. Gooch's, Bread of Life, and Wellspring Markets. "If someone had been ruthless enough, or opportunistic enough -- or, really, just smart enough -- we could've been crushed," Mackay noted in a 2004 interview, "But I don't fear that anymore. We're not that vulnerable anymore. Our culture is too strong. Our locations are too good. And we know so much more than we used to...(more)
Washboard Accompaniment, west 11th AvenueIs our town becoming another 'Anywhere, U.S.A', where large corporate chain stores extract our money, limit our choices and take our jobs? Can we preserve the sense of place and unique character that our loyal community-oriented local businesses help provide?

The mission of this web site is to share perspectives and stimulate discussion:

  1. concerning the imminent arrival of a large chain natural foods store in downtown Eugene;

  2. about the struggle of local stores everywhere to survive the consolidation of retailing into enormous multi-national chains;

  3. about the effect this '“corporatization'” has on our communities, culturally, socially, environmentally and economically.
The site is sponsored by Sundance Natural Foods, an independent natural foods retailer in Eugene, Oregon since 1971. We invite you to join the conversation by posting comments to the articles and submitting your thoughts by email to submit@keepitlocaleugene.org.

We hope that this site is a useful source of information and effective in highlighting the importance of community and local businesses in general. Thanks for visiting.
Table of Contents

All articles can be found by scrolling down from the home page or clicking on links here.

I. Editorial

Selling Out to Whole Foods? Local businesses deserve level playing field From an editorial by by local businessman and former city councilor Paul Nicholson

Quote: Where Are We?

II. Background Articles Concerning National Retailers and Whole Foods Market

Farmers' Market in Bloomington, INa. Welcome to 'Whole-Mart' Investigative reporter Mark T. Harris compares Whole Foods and Wal-Mart

b. Studies Find Local Biz Creates Far More Local Economic Activity

c. Speech: The Impact of Chain Stores on Community, by Stacy Mitchell

Quote: Local Culture is a Practical Asset

d. Paul Hawken Says Whole Foods Dismantles Local Food Webs

e. What Other Cities Are Doing

III. In the News


a. Whole Foods Says It's Not a Threat

b. International: Big-Box Worries in Australia

c. Whole Foods Market Made $41.7 Million in Last 3 Months, Up 31%

Thanks for visiting. New articles will be posted here frequently, but see the left sidebar for information about subscribing and automatic notification of new content.

Quote: Where Are We?

"Communities have to think about whether they want to lose their personality. If I were to blind fold you and drop you into an Olive Garden, you'd have no idea where you are."

-Don Burch, owner of an outdoor gear store in Louisville, Kentucky. From Keep Louisville Weird, as quoted by The Hometown Advantage: Reviving Locally Owned Business

Selling Out to Whole Foods?

Local businesses deserve a level playing field

From an editorial that appeared on June 16th, 2005 in the Eugene Weekly by local businessman and former city councilor Paul Nicholson. The full article can be read

Whole Foods Inc., an Austin, Texas-based juggernaut, recently revealed an interest in locating in downtown Eugene. Proponents claim the project won't involve a subsidy to Whole Foods Market. However, it does involve swapping city land for land that the Shedd Institute for the Arts owns and then building a parking structure...

The Chamber of Commerce propaganda machine is already in high gear, and the Register-Guard newspaper has predictably jumped on board in support. The Whole Foods Market development can be added to the long list of other ill-advised proposals R-G pundits have advocated in the past:

The Downtown Pedestrian Mall: Based on a model that had already failed in Kalamazoo, Mich., and New Bedford, Mass., it failed predictably.

The Hilton Hotel and Convention Center: Cost us a lot of money, and hasn't saved downtown.

The Downtown Athletic Club: Diverting block grant money intended for the urban poor to an exercise club for the rich has not saved downtown.

The Downtown Clearcut: Shoppers didn't like the downtown mall any better without trees than with them.

The Pankow Project: Dispatched by the voters.

The Downtown Outlet Mall: The idea was abandoned after the discovery that the developers were con artists just released from prison.

The Riverfront Urban Renewal District: After 15 years and $3 million, we still haven't seen any of the 900 new high-tech jobs promised.

The Symantec Giveaway: Symantec left for Springfield the day after its tax abatement expired.

The Downtown Six-Lane Super Highway / Coburg Road / Ferry Street Bridge Project: Fortunately defeated by the voters.

The Downtown De-Mall: Why did we spend $50 million on the mall?

Some of these ideas might have worked if carried out as part of a comprehensive, long-term plan. But past councils and mayors have been buffaloed into one ad hoc tax-subsidized scheme after another on the false premise that any project is a good project so long as it benefits development and construction interests. Reinventing or reinterpreting city plans to accommodate every private project has made Eugene's downtown an undeniable under-performer. These schemes have cost tens of millions of tax dollars and resulted in a downtown without focus, character or charm.

The article continues in the Eugene Weekly here.

Welcome to 'Whole-Mart'

Excerpts from an article by Mark T. Harris, published on July 4th 2005 and to appear in an upcomming issue of Dissent Magazine. See Mark-T-Harris.com

From Wal-Mart to Whole Foods Market, it's the same story as retail chains push public relations and profits over decent jobs. But for natural foods giant Whole Foods, getting in touch with their "inner Wal-Mart" also means sacrificing any real vision of that shibboleth of today's eco-activists—a sustainable future.

"Where in our mission statement do we talk about trying to be liberal, progressive, or universal?"

-John Mackey, CEO, Whole Foods Market, 1991
A closer look at Whole Foods business practices and founder John Mackey's ideas about business and society reveals a vision not all that different from a McDonald's or a Wal-Mart. In fact, the company's business model is more or less the standard stuff of Fortune 500 ambition.

Continue reading Welcome to Whole-Mart...

Studies Find Local Biz Creates Far More Local Economic Activity

Independent businesses have been found to generate between 60% and 300% more local economic activity that chain retail stores do. This has been the finding of the following economic impact studies:

Andersonville Study of Retail Economics October 20, 2004
  • For every $100 in consumer spending with a local firm, $68 remains in the Chicago economy.
  • For every $100 in consumer spending with a chain firm, $43 remains in the Chicago economy.

  • For every square foot occupied by a local firm, local economic impact is $179.
  • For every square foot occupied by a chain firm, local economic impact is $105.

The Economic Impact of Locally Owned Businesses vs. Chains: A Case Study in Midcoast Maine (4pg PDF) by the Institute for Local Self-Reliance and Friends of Midcoast Maine, September 2003
When residents of the Midcoast region spend $100 at a big box retailer, their purchase generates $14 in local spending by the retailer. That same $100 spent at a locally owned business generates $45 in local spending, or three times as much. Dollars spent at a local retailer support not only that store, but a variety of other local businesses, including local banks, accountants, printers, and internet service providers.

Economic Impact study in Austin, Texas
16pg PDF (2002, Civic Economics) A case study of the bookstore business, this report found that "spending $100 at Borders creates $13 worth of local economic activity, while spending $100 at the local stores generates $45 in local economic activity."

Summaries and links to these studies and many more on a variety of big-box store topics can be found at Hometown Advantage's Big Box Economic Impact Studies page.

Speech: The Impact of Chain Stores on Community

The following are excerpts from a speech by Stacy Mitchell, delivered at the annual conference of the American Planning Association, April 2000. Stacy Mitchell is a researcher with the New Rules Project, a program of the Institute for Local Self-Reliance in Minneapolis. The New Rules Project provides research and innovative policy solutions for building strong local economies and healthy communities. Mitchell is the author of The Home Town Advantage: How to Defend Your Main Street Against Chain Stores and Why It Matters. She advises communities nationwide on strategies for strengthening their homegrown economies and produces an e-mail newsletter that tracks grassroots efforts to curb the spread of corporate chains and revitalize locally owned businesses.

Developers often present new chain store developments as major additions to the local economy. They note the growth in retail sales and shopping options. They tally up the number of new jobs and the added tax revenue that the development will bring.

What is often overlooked is the other side of the balance sheet. Unlike new manufacturing facilities, which do create real economic growth, new retail stores simply shift consumer spending from one area of town to another. A new big box store can only be successful at the expense of existing businesses.

A study in Iowa, for example, found that new Wal-Mart stores derive on average of 84 percent of their sales from existing businesses within the community. Similar conclusions have been reached in studies of big box development in Massachusetts, Maine, Vermont, New York, California, and Virginia.

What all of the studies find is that very little of the sales generated by a new retail store represent new retail spending. Instead these developments simply shift economic activity from one part of town to another. The end result is not economic development, but rather economic displacement.

From an economic perspective, there is much to suggest that chain stores may not be our best value. But perhaps more significant than any of the economic considerations are the qualitative benefits of local ownership. Locally owned businesses build strong communities. They provide a foundation for the web of connections and trust that Jane Jacobs believed so essential to a healthy neighborhood.

Continue reading Stacy Mitchell's speech...

Quote: Local Culture is a Practical Asset

The loss of local cultures is, in part, a practical loss and an economic one. For one thing, such a culture contains, and conveys to succeeding generations, the history of the use of the place and the knowledge of how the place may be lived in and used. For another, the pattern of reminding implies affection for the place and respect for it, and so, finally, the local culture will carry the knowledge of how the place may be well and lovingly used, and moreover the implicit command to use it only well and lovingly. The only true and effective "operator's manual for spaceship earth" is not a book that any human will ever write; it is hundreds of thousands of local cultures.

-Wendell Berry "The Work of Local Culture" 1988 Iowa Humanities Lecture

Paul Hawken Says Whole Foods Dismantles Local Food Webs

Despite sentiments like those expressed in the company's recent press release celebrating "25 years of supporting local agriculture," long time author and organic enterpreneur Paul Hawken believes Whole Foods Market puts a variety of local natural foods providers out of business. This from an interview from February 2004 in Grist Magazine.

Whole Foods dismantles local food webs and doesn't foster what the organic movement is about. The organic and natural-food movement that I helped kick off in the late '60s was the beginning of recreating regional food webs. Local stores started all around the country and they began to source locally, and whatever they couldn't get locally they got regionally, and whatever they couldn't get regionally they got nationally. In terms of produce and bakery goods and other food items, there was a huge diversity of suppliers in the United States because there was a huge diversity of stores. Whole Foods went in and bought out the bigger, more successful stores and then rebranded them and did centralized purchasing for produce, which now comes from Chile and New Zealand and places like that. In the process, many local organic producers went out of business. Massive scale and centralization of power and capital is the antithesis of what we had in mind when we started the natural and organic-food business in the U.S.

Q: But does that totally discredit the positive things they are doing?

A: Good deeds don't erase bad outcomes. But let's talk about the positive things they are doing.

Q: Well, let's say they use recycled packaging and keep pesticides out of the soil. Isn't large-scale organic farming better than non-organic factory farms?

A: Yes, but still it's large-scale agribusiness.

Q: But they're better than Safeway.

A: They are guided by profit. So are small companies. So far so good. But when a company gets large and dominant, the same instincts to survive and prosper can become unintentionally harmful. The natural-food movement is being bought up by Phillip Morris and H.J. Heinz and Jimmy Dean. That dog won't hunt. It leads to a lowering of standards, and emphasis on price as opposed to cost. It leads to uniformity, power, concentration, and control. Luckily, there's a slow food movement in the U.S. and lots of things happening that counter that.

What Other Cities Are Doing

Here's what some other cities and towns around the country are doing to encourage local businesses' survival in an increasingly corporate climate. A list of national organizations appears in the left sidebar of this site.

Local Groups
A list of associated local organizations can be found via the national group, Business Alliance for Local, Living Economies (BALLE).

Big-Box, Chain and Formula Business Restrictions

The term "formula business" is used in many of these discussions. A formula business is one that is required by contractual or other arrangement to maintain a standardized array of services or merchandise, and standardized architecture, uniforms, logos, decor, etc.

San Francisco's Formula Business Ordinance adds formula businesses to the list of uses that require neighborhood notification under city law. Residents will be notified whenever a formula retail business applies to open in their neighborhood. They will then have the option of requesting a public hearing and subjecting the applicant to a list of criteria. In addition, formula retailers are banned entirely from the four-block Hayes Valley business district and are automatically required to undergo a hearing and review in the Cole Valley neighborhood.

Cities that have passed ordinances to limit, restrict or discourage big-box, chain or formula retail and restaurants include the following:
  • In California: Arcata, Calistoga, Carmel-by-the-Sea, Coronado, Pacific Grove, San Juan Bautista, Sausalito, Solvang and San Francisco (see above)
  • In Washington: Bainbridge Island, and Port Townsend
  • Bristol, Rhode Island
  • Port Jefferson, New York
  • Sanibel, Florida
  • York, Maine
See this article from the New Rules Project for details on the above list of towns with official formula business restrictions.

These cities and towns are just some of the places where debates, struggles and campaigns are underway to prevent the displacement of local businesses. People around the country, and around the world, are concerned about the survival of small scale, sustainable and community supporting businesses.

Whole Foods Says It's Not a Threat

We're not in the business of running someone out of town. If our great meat case makes people more aware of quality meats and makes more people look for that type of thing, that's great. We want people to eat well and enjoy eating. If that means that they're going to shop at Whole Foods, that's great. We're in the business of educating the consumer in that respect.

Those words from Ryan Puckett, spokesman for Whole Foods Market's Midwest region, in an August 2005 story about local and national food retailers in Oak Park, IL. Some local store owners interviewed for the region disagreed.

Last September Florida's Bradenton Herald asked Ronnie Cummins, national director of the Organic Consumers Association in Minnesota, about this issue.

"We wish they would colonize new areas," Cummins said. "I think they would benefit from being more sensitive to pre-existing businesses."

International: Big-Box Worries in Australia

The Australian island state of Tasmania is the newest site of growing concern about the impact of big-box retailers on local business. "Big-Box Retail Worries," a story in the Sunday Tasmanian, reports the following:

A SIGNIFICANT jump in the magnitude of "big-box retailing" in northern Tasmania has created a stir in the retailing sector.

A proposal for a homemaker centre [a hardware store?] near the Launceston Airport has prompted a backlash from the Launceston City Council, chamber of commerce and the city retailing organisation Cityprom.

A joint delegation from the three organisations recently visited New Zealand to study the effects of big-box developments...

The chamber of commerce says most of the profits from big-box retailing go out of the state and much of the product is imported from overseas.

"Only 13 per cent of turnover remains in local economies," Chamber of Commerce executive officer Jo Archer said.

"If we are going to have big-box retail we need to have controls on the size and type," Cityprom executive officer Kerry Gay said. "It is the smaller independent retailers which give the city character."

The full story is available here.

Whole Foods Made $41.7 Million in Last 3 Months, up 31%

From a news summary in RetailMerchandizer.com on July 29th, 2005:

Whole Foods Market said Thursday that fiscal 3Q profit rose 31%, driven by higher sales and improved margins, to top Wall Street estimates, according to an Associated Press report.

Net income grew to $41.7 million from $31.8 million a year ago. Revenue rose 23% to $1.13 billion from $917.4 million last year...Analysts are currently forecasting 2005 sales of $4.65 billion, compared with the company's 2004 sales of $3.87 billion.

For 2006, the company expects sales to grow by 15% to 20%, and has set a goal of $10 billion in annual sales by 2010.


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