Whole Foods Market Inc.: Expansion in Canada

In December 2012, the senior management team of Whole Foods Market Inc. was contemplating the company’s options for international expansion, including further expansion in Canada. The company, headquartered in Austin, Texas, was a natural and organic foods supermarket that had become known and trademarked as “America’s Healthiest Grocery Store.” It had seen steep growth since its inception in 1977 and had an appetite for more. Ten years ago, its first Canadian store was opened in Toronto, followed by three more stores in Ontario and four in British Columbia. Was it time to expand deeper now and, if yes, into which provinces? It would be interesting to expand into Quebec with a store location in Montreal, but that province had a strong union presence, which was inconsistent with the company’s culture. Also unclear was which management team should be running an extensive Canadian operation. Should the current U.S. team facilitate the expansion, or should a Canadian management team be developed? A systematic approach to assessing the options was needed.

This case is intended for senior undergraduate, MBA or executive classes on business strategy or international/cross-cultural management. Its objectives are the following:<br><br><br><ul><li>To understand the critical link between strategy and resources by analyzing current company resources across the value chain, comparing it to resources required to execute a strategic proposal and learning how to identify and close resource gaps.</li><li>To appreciate the complexities of growth strategies across new markets and the challenges that come with developing and executing such strategies, especially within highly competitive markets.</li><li>To recognize how cultural differences can impact a company and growth strategy, as well as the uncertainties and risks involved in transferring a successful strategy internationally due to different markets and cultures.</li><ul>

• Organic and natural foods
• growth
• resources
• capabilities
• cross-culture
• Canada
• United States