Organic retailer enters UK market
in the US, is to make its first entry into the UK with the
acquisition of Fresh & Wild, a London-based company which
operates a small chain of natural food stores.
Whole Foods Markets will pay $38 million for the British company, which has six stores in London, plus a seventh under construction, and one in Bristol. Fresh & Wild's sales in 2003 were around £17.6 million, and the company registered a 10 per cent improvement in same-store sales during the year.
"We are very excited about extending our company mission and the Whole Foods Market brand beyond the borders of the US and Canada and into Europe," said John Mackey, chairman and CEO of Whole Foods Market.
"The UK is an obvious choice due to the advanced acceptance of organics and the lack of language barriers there," he added.
"We believe an acquisition is the right strategy for our first overseas venture. As with other successful acquisitions we have made, the infrastructure and intellectual capital we will gain will provide us with an immediate platform for expansion."
The main challenge for Whole Foods will be to find sufficient space in London for its large-scale stores. Fresh & Wild's outlets are around 5,200 square feet on average, while Whole Foods stores in the US are nearer 45,000 square feet.
Whole Foods Market had sales of $3.1 billion in 2003 from its network of 146 stores in the United States and Canada, and has cornered the market for foods free of pesticides, preservative and sweeteners - a market which is continuing to grow in tandem with the number of food-related health scares such as BSE.
The UK business is likely to be the first of several in Europe, with the organic food market across the Continent realtively underdeveloped - at least as far as speciality stores are concerned.
