Wednesday, February 8, 2017

Whole Foods Market Sets Expiration Date for Georgia Store

Natural foods store to shutter later this month 

Whole Foods Market confirmed earlier today it plans to close its Augusta area location on February 22nd.  The 41,000 square foot store opened September 2014 in "Washington Crossing" on Washington Road.   The center was purchased by Fairburn-based S.J. Collins Enterprises in September 2013 and heavily renovated to accommodate the Whole Foods and other new tenants.

The Augusta Chronicle ran a story in June 2014 highlighting the improvements at Washington Crossing with excerpts from an interview with Jeff Garrison, a partner at S.J. Collins. Garrison stated, "The former Georgia State Floral Distributors space has been expanded to accommodate a 41,000-square-foot Whole Foods, which needed a larger store because of strong sales projections." 

Apparently those "strong sales" failed to materialize.  

Earlier this morning, a spokesperson from the Whole Foods Market corporate office in Austin, Texas released the following statement:  

“As we work to position Whole Foods Market for long-term success, we have carefully evaluated our portfolio of stores to align with a more thoughtful growth strategy. As a result, we have decided to close the Augusta store. This was not a decision that was made lightly and we are working closely with all affected team members to find alternative positions at nearby stores where possible.”

The closure of Whole Foods will be the first of two grocery closures planned for Augusta.  Late last month, Kroger announced it would close its store on 15th Street February 28th.  “The store has experienced declining sales and negative profit over an extended period of time,” said Glynn Jenkins, spokesman for Kroger’s Atlanta division, which includes Augusta.  The 35-year-old store, which anchors Central Square shopping center, had reportedly been struggling for years and had most recently been on a "short-term lease." 

Earth Fare, an Asheville, North Carolina-based natural foods grocer, which has reportedly struggled in metro Atlanta, operates a store about three miles from the Whole Foods in Augusta that will surely hope to capture some market share when their competitor closes.   

Amazingly, despite these closures that both cite sluggish sales, Augusta is the second largest city in Georgia with a population of about 200,000.  

Earlier this evening, Whole Foods Market released some disappointing earnings that included a 2.4% decline in same-store sales, their sixth straight decline. The grocer also indicated they anticipate seeing same-store sales down as much as 2.5% this fiscal year. The grocer did however indicate that Q1 sales should climb 3% to $4.98 billion. In response to the sales report, Whole Foods announced it plans to close nine locations in the current quarter, something it hasn't done since 2008, during the great recession. However, Whole Foods will still open six locations, including those planned for Chamblee and Kennesaw.  

Whole Foods is expected to debut a larger store on Ponce de Leon Avenue with a full service restaurant later this spring.  The existing store in Midtown Place shopping center took over a portion of its neighboring Staples store and will swell to about 50,000 square feet. Additionally, the new Kennesaw Whole Foods is meant to serve as a replacement to the existing Harry's Farmers Market (owned by Whole Foods Market) on Powers Ferry Road in Marietta, which is slated to close when the Kennesaw location opens. 

Last month, Whole Foods announced it would shut down its metro Atlanta food preparation facility by February 12th. The company is also closing regional kitchen facilities in Everett, MA and Landover, MD, shifting to outside suppliers for some of its in-store prepared foods.

S.J. Collins, which almost exclusively develops Whole Foods anchored projects according to its website, also developed the Whole Foods Market in Savannah, which opened in August 2013.  

As first reported on this site, S.J. is also developing a new Whole Foods Market in Chamblee and a new 365 by Whole Foods Market  in Decatur, which is expected to be the first in the state. In addition to S.J. projects, there are also new Whole Foods Market stores coming soon to Kennesaw and Midtown and another 365 by Whole Foods Market planned for Buckhead

Are you surprised that Whole Foods is closing its Augusta location? Which Atlanta area Whole Foods store are you most excited about?  Do you think Whole Foods will bounce back from its recent struggles or are there too many grocers offering natural foods for the retailer to compete in what has become an overly crowded space?

Please share your thoughts below.  

10 comments:

Anonymous said...

I am looking forward to the Chamblee Whole Foods because it will be very convenient. I do think there are too many specialty grocery stores now. Wonder if quality will go down since they are going to use outside suppliers for some of their food prep?

Carl said...

I'm not at all surprised, since I thought this location wasn't a good idea from the start. WFM should've left the small markets to Earth Fare (which doesn't seem to care about profitability).

AJ said...

While I'm sure there are some shoppers to do all their shopping at specialty grocers like Whole Foods, I have a feeling the vast majority shop at traditional grocery stores like Publix and Kroger and then supplement at Whole Foods, Sprouts, Fresh Market, Earth Fare, Trader Joe's... Ah, there's the problem, there are more specialty grocery chains than there are traditional grocery chains. Yes, I know there are other traditional grocery stores like Walmart Neighborhood Stores, Food Depot, etc. but I'd say over 90% of the population shops at traditional stores where maybe 50% (just throwing numbers out there) shop at specialty. There's only so much to go around. Just like the cupcake/yogurt/burger/pizza crazes the specialty grocery store craze has reached maturing and things have got to give. 365 is only going to make it tougher.

Anonymous said...

I do the majority of my shopping at Publix. I also shop at Sprouts and Costco for some things. Whole Foods does not appeal to me. Overpriced.

Anonymous said...

Whole Foods' problem is that their prices are too high. I used to buy most of my food there, but now find many of the same products at much lower prices at Publix and Target.

Anonymous said...

The Fresh Market in Snellville is never busy with (purchasers) customers and don't expect it to survive. IMO AJ is correct about the imbalance of specialty vs traditional grocery chains. A market like ATL needs a better mainstream grocery store to compete with Kroger & Publix.

dal787 said...

I wish Harris-Teeter had been able to thrive here. Maybe if they had, they could have remained independent, or merged with Whole Foods. They closed in Augusta too.

Bl@zr said...

@ dal787 Harris-Teeter was bought out by Kroger back in 2013 so Kroger had no need to put them into markets where Kroger already existed.

dal787 said...

I realize that. That's why I mentioned them not thriving here, nor remaining independent. Harris Teeter operated stores in Atlanta until about 2001. The Ponce WF and Peachtree Kroger (now Sam Flax) were built as HTs, but they exited the market before construction finished. The new Brookhaven Steinmart was their first Atlanta store and corporate flagship. It was amazing when it opened.

WF makes a better partner for HT than Kroger.

Anonymous said...

So, what is the holdup opening the Kennesaw Whole Foods? The building has been finished for months. It has the most prominent location in the new complex at one of the busiest intersections in Cobb County, US41 and Ernst Barrett Pkwy. What's the problem???