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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

On a trip to Portland, Oregon, last year, I had my first opportunity to visit the city's famed downtown Powell's Books one rainy winter afternoon. After all I had heard about the independent bookstore, I was struck by its rather unglamorous façade. The warehouse sized Powell's looks more like some washed-out old school book depository than the nation's purportedly single largest retail bookstore site. But a block away a quite different look captures your attention. The new Whole Foods Market greets Portland shoppers with its soft hued lighting, high ceilings, and carefully coiffed displays of choice desserts, breads, and organic foods. The overall effect is more like entering some modern cathedral to upscale consumption, one in which the dogma is not suffering but celebration (and plenty of tithing at the cash register). The casually dressed clerks add to the sense of Whole Foods as business as unusual. Mostly young, many of the employees convey a kind of "alternative" aura that says you'll never catch me working at Wal-Mart.

But where Wal-Mart has come under deserved scrutiny from labor, community, and women's activists for its exploitative "big box" business model and miserly wages, Whole Foods, the world's largest natural foods retailer, enjoys a reputation as a progressive trendsetter at the forefront of a "green lifestyle revolution" in American life. But then a slogan like "Whole Foods, Whole Planet, Whole People" does tend to conjure up more ennobling vistas of planetary progress than, "We Sell for Less."
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.

This is a vision of mega-chain retailing that involves swallowing up or driving out of business smaller retail competitors. It's a business model that objectively complements the long-term industrialization of organics (i.e., large-scale corporate farms) over small family farms. It's also a "progressive" business vision in which concerns about social responsibility do not necessarily apply where company suppliers are concerned. Subsidiaries of cigarette manufacturers (e.g., Altria, owner of Kraft's organic products) and low-wage exploiters of Hispanic workers (e.g. California Bottling Co. Inc., makers of Whole Foods private label water) are apparently welcome contributors to this particular corporate version of "the sustainable future." Environmental rhetoric aside, none of this should come as a surprise. Mackey's dream of a natural foods empire is one that became possible in the late 1980s with venture capital provided by financiers Oak Investment Partners, Criterion Venture Capital Partners, and First Interstate Capital Corp., all firms with track records as profiteers in weapons manufacturing, as The Texas Observer first reported in 1991. Yet marketing for socially responsible business can create the impression that there is such a thing as a clearly demarcated progressive business sector, reforming capitalism one sustainable mission statement at a time, and then there is the rest of business. But businessmen like the Whole Foods founder probably understand better than the liberal public that the ethical line in the sand between a Wal-Mart, McDonald's, or Whole Foods is mostly just that—sand.

In fact, the apparent boundaries separating such firms tend to wash away at the first wave of inquiry to reveal the web of connections between businesses and subsidiaries and the common ground of their respective business models. For the record, Mackey has not hesitated to defend McDonald's as a contributor to the public good, despite the junk food and minimum-wage jobs it sells to children and young adults. Nor does he have any problem with Wal-Mart, despite its atrocious labor record or the way it drives competitors out of business and drives suppliers overseas in pursuit of rock-bottom costs.
When I recently spoke to [Paul] Hawken, he described the natural foods business today as dominated by a "scale-up-and-sell-out" crowd of entrepreneurs. "Everybody wants to sell out to somebody who's publicly traded and wants to consolidate earnings and sales and show 14 percent growth rates," says Hawken. "The industry has become one dominated by people who are trying to create large businesses." The consequences are measurable in the steady consolidation of the natural foods economy that's occurred in recent years. "Whole Foods stores are excellent, well-designed, and abundantly stocked," says Hawken. "But in retail one by one they've bought out the biggest competitor in town.

Purchasing has become increasingly consolidated, which means they then need vendors who can satisfy all the stores, or the western states and so forth. That narrows down the vendors a lot." Since the early 1990s, Whole Foods has bought out such competitors as Bread & Circus, Fresh Fields, Bread of Life, Merchant of Vino, Nature's Heartland, Food for Thought, Harry's Farmers Market, Mrs.Gooch's Natural Foods Markets, and more recently British-based Fresh & Wild, representing dozens of store operations. There have also been buy-outs of a number of single-site neighborhood stores, such as the once thriving Oak Street Market in Evanston, Illinois, among others.
A city consumer guide greeted the arrival of the first Whole Foods in Portland,Oregon with the obliging observation that finally downtowners had a supermarket where they were invited to "treat the body like a temple." An atmosphere of such pleasance was promised, the guide's writer gleefully declared, that not only consumer taste buds would shout thank you, but consumer souls as well. It's a good bet that small morsel of marketing fluff was fed to the editors by the Portland public relations-lobbying firm, Conklin Fiskum & McCormick, which Whole Foods hired to promote its arrival in Oregon. Ironically, Conklin Fiskum & McCormick played a key role in 2002 in defeating an Oregon ballot measure that would have required mandatory labeling of genetically engineered (GE) foods.