Worcester Business Journal

14 Worcester Business Journal | January 22, 2018 | wbjournal.com F O C U S E C O N O M I C D E V E L O P M E N T Two of the grocery industry's unique brands are about to settle in Central Massachusetts BY GRANT WELKER Worcester Business Journal News Editor G rocery shopping can be a mundane experience, a get-in-and-get-out exer- cise not exactly stirring up passion. Then there's Whole Foods Market and Market Basket. Two of the most talked-about super- markets – at roughly opposite ends of the price spectrum – are poised to enter the Worcester market for the first time. Whole Foods is slated to open Jan. 30 at Shrewsbury's Lakeway Commons, while Market Basket would anchor a proposed shopping center at the former Edgemere Drive-In on Route 20, about three miles away. Texas-based Whole Foods is known for its prepared foods and for ushering in a organic and local-food movement now common at practically every gro- cery store chain. With its own unique and troubled history, Market Basket, based in Tewksbury, is famous for its customer service – there are no self- checkout aisles, for example – and pric- es as low as anywhere. Both Market Basket and Whole Foods enter a crowded grocery field – a notoriously low-margin business – in the Worcester area. Worcester itself has Stop & Shop, Shaw's, Price Chopper, Price Rite, Aldi and Big Y, while Wegmans is in Northborough, Market 32 is in Sutton, and Trader Joe's – another cult favorite – is in Shrewsbury just down the street from where Whole Foods will open. Yet, the Worcester market appears ready to handle this increased load in grocers. The population of Shrewsbury swelled 3.4 percent between 2010-2016 while Worcester grew 1.9 percent. Throughout all of Central Massachusetts, the population has increased 3.9 percent. A strict wholesome experience Whole Foods, which already has 31 Massachusetts locations including Framingham and Sudbury, has long had a reputation extending far beyond its parking lots. To detractors who don't like the chain's traditionally high prices, the company is known derisively as Whole Paycheck. To fans, the company offers better prepared foods and organic and local options than anyone else. "They're just really good at curating ethical and healthy foods for people," said Julie Irwin, a business professor at the University of Texas, which is based in Whole Foods' hometown. "They're really strict about what they carry and what they don't. A customer can walk in and know that items have already been screened, so to speak, for things like animal rights," she said. The business world and shoppers have wondered whether being part of Amazon would change Whole Foods, but so far it appears it hasn't changed substantially except for lower prices on some items. Amazon announced the $14-billion acquisition last August. "There was this question of what will it be like when you go in [after the Amazon deal], but I don't think it seems any different," Irwin said. The 50,000-square-foot Shrewsbury Whole Foods will have two unique fea- tures: Amazon Lockers, where shoppers can pick up or return packages, and the Borgatti Bar, a second-floor restaurant with snacks, sandwiches and salads, and 2017 $16.0 $245 -1.5% 2016 $15.7 $507 -2.5% 2015 $15.4 $536 2.5% 2014 $14.2 $579 4.4% 2013 $12.9 $551 6.9% Whole Foods' perfomance While Whole Foods' sales have increased in the last five years, its profits dropped off last year and its comparable store sales -- a measure of how Whole Foods single locations perform year to year -- has been down the last two years. Year Sales (in billions) Profit (in millions) Compararable store sales Source: Whole Foods' Securities and Exchange filings. Sales rounded to hundred million, and profit to the million. GROCERY GROWTH P H O T O / W H O L E F O O D S Whole Foods Market, which is opening in Shrewsbury Jan. 30, is known for its high-end offerings such as prepared and organic foods.

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