Whole Foods Plans 1,200 Store Expansion, Reports Strong Fourth Quarter

By Jennifer Lynn, contributing writer

The company opens 12 new stores and plans to expand to 1,200 stores throughout the entire U.S.

Whole Foods Market’s fourth quarter total sales reached a record $12.9 billion, an increase of 10 percent from the 53-week period last year and an increase of 13 percent on a comparative 52-week basis. "We reported record fourth quarter operating results which contributed to the best fiscal year performance in our Company's 35-year history," says John Mackey, cofounder and co-CEO of Whole Foods Market. Comparable store sales increased 6.9 percent, and identical store sales, excluding six relocations and four expansions, increased 6.6 percent.

“For the last four years, we have increased our new store openings while producing improvements in operating margin and higher returns on invested capital, and we expect these trends to continue in fiscal year 2014,” Mackey says. The retailer is potentially planning to expand to 1,200 stores throughout the U.S. Twelve new stores were opened in the fourth quarter, resulting in a record 32 store openings in the fiscal year. In the first quarter of fiscal year 2014, the company has opened five stores so far and expects to open five more. The company currently has 367 stores open totaling approximately 13.9 million square feet. The company recently signed 14 new leases averaging 38,000 square feet.  These stores currently are scheduled to open in fiscal year 2014 and beyond.

How to manage an expanding workforce

Whole Foods new stores are continuing to perform beyond expectations. At 36,000 square feet in size, they have produced average weekly sales of $515,000 translating to sales per square foot of $738, and have generated a contribution margin of approximately 5 percent. The company successfully expanded into 10 new markets and increased its ending square footage 8 percent to 13.8 million.