Whole Foods 2007 Annual Report Download - page 19

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Store Operations
Team Approach to Store Operations
We strive to promote a strong Company culture featuring a team approach to store operations that we believe is distinctly
more empowering of employees than that of the traditional supermarket. Our domestic Whole Foods Market stores each
employs between 85 and 600 team members who comprise up to 13 teams per store, each led by a team leader. Each team
within a store is responsible for a different product category or aspect of store operations such as customer service, prepared
foods, or grocery, among others. Just as we have a regionally-focused framework, we also promote a decentralized team
approach to store operations in which many decisions are made by teams at the individual store level. In this structure, an
effective store team leader is critical to the success of the store. The store team leader works closely with one or more
associate store team leaders, as well as with all of the department team leaders, to operate the store as efficiently and
profitably as possible. Twice yearly, our team members are asked to complete a confidential, third party-administered team
leader survey, which provides them with an opportunity to give their leaders constructive feedback.
We believe our success is dependent on the collective energy and intelligence of all of our team members. We strive to create
a work environment where motivated team members can flourish and reach their highest potential, and where they are
inspired by work that provides them with a greater sense of purpose and mission. For many team members, their job is an
extension of their personal philosophy and lifestyle. Together, we go to great lengths to satisfy and delight our customers.
Team members are involved at all levels of our business. We strive to create a Company-wide consciousness of “shared fate”
by uniting the interests of team members as closely as possible with the interests of our shareholders. One way we reinforce
this concept is through gainsharing. Our gainsharing program rewards things such as labor productivity that team members
can control, giving them a direct stake in the success of our business. We also encourage stock ownership among team
members through the following programs:
• Team Member Stock Option Plan. All full-time and part-time team members are eligible to receive a grant of stock
options each year. The annual grant has two components: (i) Annual Leadership Grants to recognize and incentivize
team member performance; and (ii) Service Hour Grants to recognize team member service to the Company. In
2007 our Board of Directors awarded approximately 1.7 million options to more than 13,400 team members. Of
these stock options, 95% were granted to non-executives, with 47% awarded as Service Hour Grants alone.
• Team Member Stock Purchase Plan. Through bi-weekly payroll deductions, all U.S.-based non-seasonal team
members with at least 400 service hours may elect to purchase unrestricted shares of our stock at 95% of market
value on the purchase date. The shares are purchased for the plan participants on a quarterly basis. Approximately
2,000 team members currently participate in this plan.
• Team Member 401(k) Plan. Whole Foods Market stock is an investment option within the Company’s 401(k) plan.
Store Description
We do not have a standard store design model. Instead, each store’s design is customized to fit the size and configuration of
the particular location and community in which it is located. Our culture and philosophy is one of continual innovation and
experimentation, and successful experiments are voluntarily picked up and improved upon by our stores and regions. We
strive to transform food shopping from a chore into a dynamic experience by building and operating stores with colorful
décor, well-trained team members, exciting product mixes, teams of in-store chefs, ever-changing selections, samples, open
kitchens, scratch bakeries, hand-stacked produce, prepared foods stations and European-style charcuterie departments. To
further a sense of community and interaction with customers, our stores typically include sit-down eating areas, customer
comment boards and customer service booths. We have “Take Action” centers for our customers who want to be informed
on important issues relative to environmental, legislative, food safety and product quality issues that can directly affect our
customers’ health and well-being. In addition, some stores offer special services such as massage, valet parking and home
delivery. We believe our stores play a unique role as a third place, besides the home and office, where people can gather,
interact and learn while at the same time discovering the many joys of eating and sharing food.
Purchasing and Distribution
Our buyers purchase products for retail sale from local, regional, national and international wholesale suppliers and vendors.
The majority of our purchasing occurs at the regional and national levels. This enables us to negotiate better volume
discounts with major vendors and distributors, while allowing our regional and store buyers to focus on local products and
the unique product mix necessary to keep a neighborhood market feel in our stores. We are increasingly focusing more of
our purchasing on producer-direct and manufacture-direct programs, and we remain committed to buying from local
producers that meet our high quality standards.