What the Whole Foods Buyout Means

Oops, looks like this got prematurely posted as I was working on it. So here it is again, all finished-like!


I pick on Whole Paycheck – I mean, Whole Foods – a lot. I did it before I started working there, and I do it even more now that I’ve seen first-hand how the proverbial sausage is made. Why? Well, first off, they make it so easy. They’re a grocery store for the clueless and self-righteous elite, for people who’ve probably never worked a service job in their life. They prey on the aforementioned elites’ desperation to buy happiness, to buy enlightenment, to buy guilt-alleviation, and to buy youth, beauty, and whatever the hell “wellness” is. And since they opened their first store back in the 80’s, they’ve done a pretty damn good job.

But not quite so much anymore.

Sales for the all-natural grocer have been in steady decline for some years now. I’ve heard stories from co-workers about the good ol’ days of gainsharing payouts – gainsharing is the store’s practice of dividing up some of a store’s excess profits over the course of the year and distributing it among employees around the holidays – which used to be in the hundreds of dollars. In the past 5 years, payouts have plummeted, and have recently been in the measly dozens of dollars. And if this is happening at the leading store in the entire region, employees at other locations probably see hardly any payout at all.

The Big Squeeze

To put the severity of this in perspective: the gainsharing board at my store, a little corner of baseless and manufactured optimism, is proud to boast month after month of surplus that will be available for the gainsharing program; one little detail, though, is that these surpluses are not from sales, but from labor. A labor surplus means that when employees are let go, or when they move on, they are not replaced, leaving the rest of the team to pick up the slack. More work is created for those remaining, so a gainsharing payout from a labor surplus is hardly an extra “bonus” at all – it’s actually hard-earned pay and it’s peanuts to boot.

This kind of cannibalization, this slow speeding up of the treadmill, I’ve begun to call The Big Squeeze. It’s happening across the board in the US economy, and hitting the retail sector hardest.

Imagine, for a moment, a toothpaste tube. It’s brand-new and filled to overflowing. At first, you only have to give the tube the slightest pinch to get some of the toothpaste out. But as more and more of the toothpaste gets used up, you have to squeeze harder. Without taking the analogy too far, imagine a fist holding the tube in the middle, and squeezing the toothpaste out that way. The middle disappears first, right? That fist, squeezing the tube empty, is what our economy looks like right now. And toothpaste, remember, rarely finds its way back in the tube, let alone worked back to the bottom.

Another way in which things resemble a Big Squeeze might be found in the metaphor of an orange being juiced. Getting the juice out is easy for the first few seconds, but quickly becomes more difficult as there is less and less to extract. The same principle can be applied to the labor situation. To use my experience as an example again: another co-worker told me that when she first started at our location about 3 or 4 years ago, the job was orders of magnitude simpler. The menu was half of its current size, we had less equipment to use and manage, and the ingredients we worked with were far fewer.

In my short 8 months there, the menu has grown by about 30%, the number and variety of ingredients used to make orders have almost doubled, and time spent making orders has increased. Adding to this is further complexity due to changes in the chemicals we use for cleaning and sanitation, and more rigorous procedures associated with their use. (Because of those wonderful labor “surpluses”, we don’t have the time to actually perform any of those procedures, and are often required to cook the log books while supervisors look the other way. Who the fuck has time to check the PPM of chemical formulas twice a day when we sometimes don’t even get the opportunity to take our legally-mandated breaks?) And yet, there’s still only ever one or two of us doing the work that three or four people should be doing.

All of this has been an effort on the part of Whole Foods to squeeze extra efficiency out of its employees. First, they gutted labor, but once you’re already running on a skeleton crew, you can’t get rid of any more people; there’s only so much fat you can trim. So the next strategy is always, invariably, to extract more efficiency out of what you have left: you try to expand the size of the ship and spread your skeleton crew thinner. You can’t make them work longer hours, but you can train people to do a wider variety of things, so that they might be more versatile employees, or just hire floaters in lieu of department-specific workers (sacrificing expertise and customer service). You introduce more and more complexity to the jobs they already do, barraging customers with a larger buffet of choices (which all cost extra, but succeeds in distracting from the dip in quality of core products; at least, for a time).

These are all tried-and-true methods of a failing business – it’s also, if you think about it, how a star goes supernova. The question is, does it collapse into a dwarf star or a singularity? Whole Foods was limping, and Amazon pounced – personally, I feel as if the company has gotten swallowed up by a supermassive black hole before we even got a chance to find out either way.

A Horseman of the Apocalypse

Amazon, along with Google, Facebook, and Walmart, are the proverbial Four Horsemen: Surveillance, Enclosure, Monopoly, and Conquest.

As the Horseman of Enclosure, Amazon would be more than happy to see the dissolution of retail and public space as we currently know it. In fact, Jeff Bezos would probably wet himself with glee if the American public didn’t ever leave the house – they’d do all their shopping and consume all their entertainment from the comfort of their armchairs, likely using Amazon to do it. A few months ago, that kind of domination would not have been complete, though. As Fortune explains, the grocery business is a notoriously tough nut to crack, and aside from the smattering of shop-for-you services that have cropped up in recent years, online companies looking for an “in” haven’t found one… until now:

“Food has been insulated from the e-commerce revolution over the last 20 years, but the reality is consumers are going online, they are expecting mobile, and they want the ultimate convenience,” said Michael Wystrach, co-founder and CEO of meal delivery service Freshly, in an interview with Fortune. “The evolution of the grocery store business is going to evolve dramatically over the next five years.”

“The reality is consumers are going online”.

I don’t think I actually buy that when it comes to food. I’m not really able to find data, but if Instacart’s Foodie Awards are any indication, it’s that higher-end, “artisan” food products are the most popular purchases its customers make. It’s not quite Blue Apron-level elite, but these kinds of products (cold brew coffee, artisan marshmallows, prosciutto, etc.) are pretty firmly outside the price range of the working class. The lower middle class, the working class, and those in even lower income brackets, then, are clearly not doing their grocery shopping online.

What’s happening here, then, is that Silicon Valley and the other bloated behemoths of e-commerce are introducing disruptive technologies and business strategies that only the monied are in a position to take advantage of, then, still propped up by venture capitalist cash and itching to get out of the red, proceed to declare that “all” consumers want the future of X industry to go in their direction, and then actualize their self-fulfilling prophecy by muscling their way into markets that don’t actually want them, or by merging with bigger players and choking off the competition, leaving the less monied with no other choice but to shell out. This is how Walmart, the Horseman of Conquest, functions in the brick-and-mortar world. Amazon simply does it in notional space – by colonizing your purchasing habits even though other alternatives are still technically available.

Instacart will not ultimately survive the Amazon buyout unless it, too, is assimilated. Me and a few of my co-workers, in fact, don’t even predict that Whole Foods will survive the buyout. It will either not exist in another 10 or 15 years, or will have been rendered completely unrecognizable. This is what companies in capitalist economies do, though: the only way to survive is to cannibalize your own long-term interests, and then prostrate yourself before the highest bidder.

In other words, the only way to get toothpaste out of the tube is to squeeze.

Where Values Don’t Really Matter

In the hallways behind the public-facing part of the store at my location, we’ve got the “Core Values” painted on the walls. They’re nothing more than bits of decoration on otherwise drab gray paint that everyone ignores; a perfect microcosm to how often anyone at the company thinks about them when making a decision, least of all the CEO. Be wary of for-profit businesses who claim to have a mission statement beyond “make as much money as possible”, because when their back is to the wall, or when a quick buck is to be made, you can bet your ass that money will always trump the “mission”.

The extent to which a large corporate entity can ignore its own mission statement at the prospect of increasing sales can’t get any more evident than with Whole Foods post-buyout. For shits and giggles, I’ll go over each tenet and explain just how, exactly, it will now cease to have any meaning. (Not that many of them ever did.)

  • We sell the highest quality natural and organic products available: This is just plain wrong – really, only somebody who literally has their head up their ass would believe this. This is, of course, if you don’t equate “high-quality” with “fancy” – ie. products that have way too much R&D invested in their packaging, or products that have been processed to heck and gone to make it more palatable to western tastebuds.
  • We satisfy, delight, and nourish our customers: This one’s tricky because none of it really means anything. However, our customers are dissatisfied and irked all the time; every day those kinds of people make my job just that much harder as I watch them cut each other in line, snap their fingers at us to get our attention, or interrupt us as we’re helping somebody else. In fact, it seems like almost half of our customers seem to be in a bad mood on any given day!
  • We support team member excellence and happiness: This has always been bullshit, but now with Amazon running the show, I can’t see it ever improving. Amazon is one of the worst employers out there, and you’d be hard pressed to get me to believe that there won’t be bleed-over in how Whole Foods will be expected to treat its workers in the future, especially if Amazon is looking to create an even tighter, leaner ship. I already explained the so-called “labor surplus” above, but also there’s the fact that raises are hard to come by, everyone who works there is constantly amped up on nigh-lethal doses of caffeine just to keep up with the hard, unpredictable hours, and perks are far and few between.
  • We serve and support our local and global communities: Aside from the small smattering of fair trade items that the store stocks (and ignoring that the Fair Trade label has problems of its own), I don’t really see how WF differs drastically from any other typical grocery store. Unfortunately, now with Amazon in the picture, this will be even more meaningless: Amazon cares nothing for anything but “free trade” – that is, the sort of free trade that makes it easier for them to muscle their way into whatever markets, wherever, and to chew people up and spit them out.
  • We practice and advance environmental stewardship: Laughable. Simply laughable. I shouldn’t have to explain why this is such a bald-faced lie. Oh wait, I sort of did.
  • We create ongoing win-win partnerships with our suppliers: This may be true as of right now. I’m not sure. I know that’s not always been the case, though, especially with that little scandal about WF using prison labor to source some of their products. (Prisoners, that is, who legally get paid less than a dollar per hour of work, and whose employ is not federally regulated.) Post-buyout, again, I can’t really see this improving. All I know is how Amazon treats its self-published authors and what it does (or does not do, rather) for product pricing.
  • We promote the health of our stakeholders through healthy eating education: I’m guessing that “stakeholders” here means customers and employees, in which case it’s a wash. Only a couple of the stores I’ve been to actually host classes and workshops about healthy eating, and the rest is your superfood of the week bullcrap. Like the whole juice trend (and not to mention the partnership with Juicero a few of the So Cal stores have made): juice is not actually that healthy. It’s basically nature’s flat soda: sugar water. And yet, along with a lot of other over-priced “food” items making dubious promises, like probiotics, prebiotics, turmeric, bone broth, and wheatgrass, they keep pushing it on the consumer. This stuff isn’t any healthier than the boring shit like brown rice and cabbagebut it sure is for WF’s coffers!
  • We create wealth through profits and growth: I saved this one for last because it’s the only honest sentence they have in their whole portfolio of marketing copy. The problem, obviously, is wealth for whom. Certainly not employees, and it’s definitely a questionable claim regarding their supply chain, but as far as corporate goes, this is 100% true. So congratulations, Whole Foods, your mission statement isn’t all lies, at least.

The Future of the Grocery Store

Part of Whole Food’s decline is in no small part due to the wider availability of organic food now than when the company started over 30 years ago. This has forced it to respond in predictable ways: provide ever more niche goods as well as target a niche market – upscale health-conscious consumers rather than the grubbier hippy-types that started the health food store industry. Unfortunately, when you cater to the rich and well-to-do, you have to make a lot of compromises to keep them coming back. This is how we got that Juicero pilot program – the Juicero itself the epitome of Silicon Valley hubris – and other food fads, each one in turn promising, in ever more colorful language than its predecessors, health, happiness, and everlasting youth.

What Amazon might plan to do with Whole Foods should scare you, though. If it means to make a hard push for personal shoppers, then say goodbye top even more customer service jobs as the rest of the grocery industry is forced to kow-tow to the course charted by the e-commerce behemoth. Personal shoppers, not being the people for whom a good customer service experience is directed toward, won’t mind waiting in longer lines as cashiers are let go. People with experience and knowledge about certain products won’t be necessary either – a personal shopper’s job rarely involves making decisions that would require the input of an expert. They are usually hesitant to make any executive decisions on behalf of their clients at all, as a matter of fact. If nothing else, the Amazon deal will result in fewer jobs in the long run, and WF stores will likely be nothing more than the raw material to start its own warehouse chain specifically catering toward gig economy personal shoppers.

Whole Food’s share of the organic and all-natural pie will not be growing again. This is what the big picture is telling us, for those who might listen. As wealth continues to trickle up, as the middle continues to hemorrhage due to the big squeeze, the number of customers who can afford to shop at Whole Foods will only shrink. And as that customer base shrinks, the only way to stay out of the red is either downsize, or find new markets. Amazon will likely encourage, if not downright force, both. The downsizing is already happening; see above. And it’s only worked a little bit, only bought the company a little more time. So what does Amazon plan to do?

Well, Jeff Bezos has said that he wants to use WF to compete with the big warehouse stores like Costco and Sam’s Club, and that should be an indication of the future he’s imagining. This should terrify you: because what Amazon wants, Amazon usually gets. It’s obliterated the brick-and-mortar retail industry, eradicating employment at traditional stores, and introduced logistics jobs in their place. Now instead of being a full-time employee at some store, where you get a decent amount of human interaction, where you get benefits and perhaps a store discount, you can work in a sprawling, sunless warehouse complex where you rarely speak to anyone while on the clock. Or, you can ship packages for them, using your own car, your own insurance, and your own gas money.

No matter what they might try to tell you, this is the future Amazon has in mind for the grocery store:

And they’ll let nothing get in their way.