Thursday, August 09, 2007

Whole Foods UK whisleblower STRIKES AGAIN!

Last weekend, an anonymous commenter dropped a tip into our laps at the Global Headquarters of Lee Distad's Professional Opinion about another storm brewing at beleaguered new age grocery chain Whole Foods.

Anonymous said...

More bad news for Mr. Mackey. It seems that Whole Foods employees from the states who were sent to the new Kennsington store in London on assignment were instructed to misrepresent their status as visiting workers and instead claim observer status in order to avoid the hefty work permit required by UK immigration. The problem is not all workers claimed the same status, yet all filled the same niche as temporary workers. I don't know who is in charge of the London stores but it can't look good for corporate headquarters in Austin.12:53 PM

Despite being a fan of scandal and turpitude, I called the allegation into question, based on a complete and total lack of corroboration from other sources. I even went so far as to publicly question whose sockpuppet this might be.

Well, in the wee hours (22:10:18 PDT, specifically) last night, the anonymous tipster struck again:

Anonymous said...

Your confirmation should hit cyber space before Friday. The North Atlantic Region office of Whole Foods was in damage control mode Wednesday, all staff who had been to the UK were instructed to not speak to the press. There is real fear and trepidation amongst the Whole Foods Staff because Whole Foods is claiming they send staff, but not to do productive work. Staff claim they are going to the UK as tourists but put in a regular 8 hour day. That begs the question of why they are sending so many employees to the UK if they are not doing productive work.
11:10 PM

Wow. Just, wow.

Whoever the whistleblower is, they seem determined to kick over this particular anthill. So, is Lee Distad's Professional Opinion special, or is this story being salted all over the blogosphere? As of yet, I haven't seen corresponded anonymous commentary elsewhere, which makes me feel like I'm being wound up.

While we wait to see if their tip plays out in the media, we've got two tasks ahead of us:

1) Speculation on who the anonymous whistleblower is. My guess is that John "Rahodeb" Mackey is trying to atone for past sins of disclosure by demonstrating self-sabotaging behaviour. Pretty far-fetched, but it makes a good story, no?

2) Coming up with a catchy nickname for this anonymous whistleblower. The first ones that have popped into my head were total crap. Feel free to make suggestions in the comment section below.

Let's make it a contest. If we have a clear winner for the whistleblower's nickname, I'll see about some sort of nominal prize, in addition to the fame that will accompany you (or your sockpuppet) if this thing blows up in the media like our new contact seems to think it will.

Sphere: Related Content


Porta's Cat said...

The Organic Manic?

The Free Ranger?

Silent Soy?

The Anti-Bragg? (got to know Whole Foods US (at least) for that one)

Deep Hemp?

Flatland Pastor said...


This tipster has to be "Deep Artichoke".

'Nuff said!


Anonymous said...

The transition from the US market to the UK market has not been the seamless operation one would expect from the darling of the natural food industry in the United States. First Tesco accomplished a minor coup by trade marking the Whole Foods label, even though Whole Foods Market had had a presence in the UK for 3 years with the Fresh and Wild stores. Then the new 80,000 square foot Kensington was months late opening and is bleeding red ink. Although the nearly 200 store chain purports to be the organic alternative, only 10 percent of its product mix in the UK is certified as such. Recently it was reported that local sourcing regulations were ignored by Whole Foods when calling certain produce local. Now Whole Foods is in an immigration row. It seems that a scheme was cooked up in the North Atlantic Regional Office of Whole Foods Market Boston office to make the Kensington store look more profitable than it really was. The plan started by having company Team Members from the States come to the UK to prepare for the opening of the huge Kensington store. The Team Member's home store in the States would pay the salary and expenses of the visiting employee while they were in the UK. Visiting workers in the UK are also required to get a work permit through immigration before entering the country. Whole Foods at first complied with the work permit law but then decided the 1400 pound per employee fee was too steep for the chain that has been dubbed "Whole Paycheck" by value shoppers in the U.S.. North Atlantic region president David Lannon cooked up the scheme whereby Whole Foods employees from the states entered the UK on tourist visas to avoid the work permit fees. Although the employees salary, transportation, lodging and food costs were paid while they were in the UK and employees were required to put in a regular 8 hour day while at the Kensington store they skirted the fee by claiming they were not doing any productive work. The problem is that the properly permitted predecessors from the States and the un-permitted reinforcements did the same kind of work in the UK. When word of this scheme was revealed to the press the usually sanguine Whole Foods staff became tight lipped in a hurry. Kensington Store Team Leader Rick Bonin refused to comment on the scheme. Laura Derba, the North Atlantic region vice president instructed all Whole Foods staff to not speak about the issue to the press. The public relations office of Whole Foods is claiming that the scheme is valid because Whole Foods employees in the states were engaged only in training programs while in the UK and did no productive work in the Kensington store. Visiting employees from the States offered no training seminars or workshops to the UK Whole Foods workers at the Kensington store however. There are currently workers from the States at the Kensington store who have reportedly been engaged in productive work during their stay in the UK. This type of story can not bode well for the company. Saving a few quid at immigration in a country where there is a strong trade union presence who will turn this into a political football is truly being penny wise and pound foolish. It does not help that Whole Foods has imposed a news blackout on employees who had been in the UK as it begs the question "What do they have to hide?"

Anonymous said...
Check the above for the same story and yes W.F. is bleeding itself dryin Kensington and there are or were a lot of Americans working behind the counters but mysteriously most of them have disappeared !!!! So it would seem there must be some smoke there !
The store is a shambles. Barkers had four entrances and W>F blocked them up leaving only one with a bunch of heavies guarding it. What are they trying to protect...a sinking ship.?

Anonymous said...

Is Whole Foods Market’s John Mackey up to his old tricks? 03.08.07
Early this morning (2nd August), 6am French time, and both had comments posted on them by a poster identified as rohadeb, the same alias used by John Mackey on Yahoo Finance to denigrate his competitors and boost his own company.

The comment posted on both sites under the alias rohadeb made allegations that senior management in the US with responsibility for the UK Whole Foods Market roll out have instructed US employees to lie to the UK immigration service and thus avoid unnecessary expense for the company. In the comment posted to naturalchoices the manager was actually names as one David Lannon, identified on the Whole Foods Market site as Vice President with responsibilities for the North Atlantic region. The message on newconsumer did not name an individual, saying rather “region president overseeing the London Whole Foods Market”.

The message posted read “Breaking news: Whole Food employees from the states have been directed by regional president David Lannon overseeing the London Whole Foods Market to lie to goverment officials in order to avoid paying the 2000 pound per employee work permit. As noted there are many Whole Foods Market employees from the states who have come to work at the London store. Penalty is 5000 per offense. Someone is going to be sacked over this one. Wait until the trade unions get ahold of this tidbit and turn it into a political football.”

It is unlikely that Whole Food Markets, who have already invested $38 million dollars with the acquisition of Fresh and Wild and whose flagship first UK store in Kensington would not have come cheap, would have deliberately directed its US posted employees to lie to the UK immigration officials. The potential public relations downside of such an action would completely undermine their plans to spread the Whole Foods Market chain across the UK when already the first shop does not seem to be attracting the numbers anticipated.

It has recently been revealed by the Federal Trade Commission investigation of the Whole Foods acquisition of Wild Oats, their nearest competitor in the US, that CEO John Mackey posted hundreds of messages under the alias rohadeb, an anagram of his partner Deborah name, attacking Wild Oats and promoting his own store. While not yet proven illegal, unless he disclosed insider financial information, it has been seen as at best unwise, and at worse foolish and unethical by the US financial community.

Is he up to the same tricks again or is it an imitator or an insider sending these messages? We would love to know.

It may be no coincidence that naturalchoices and the debate on newconsumer have not been wholesome in their praise of Whole Foods Markets, particularly its anti-trades union stand.

Peter Shield

Related links
Newconsumer discussion on Whole Foods Market
Comment on this article
Is Whole Foods Market’s John Mackey up to his old tricks?
7 August 2007 11:56, by Peter Shield
Official Statement sent to Natural Choices by Whole Foods Market

“Whole Foods Market is a well respected employer throughout the US and now in the UK. It fully complies with all UK and US immigration laws regarding the employment of its Team Members.

We have invited several Team Members to travel to the United Kingdom for varying periods of time to assist us with post-opening activities such as instilling our company culture and sharing best practices and knowledge. These Team Members will assist with the promotion of our quality and merchandising standards in accordance with our brand image. This assistance may consist of demonstrating business practices, techniques and strategies for excellence in retailing the Whole Foods Market way.

The training and support that these Team Members provide will ensure that the new store complies with the Whole Foods Market brand and standards in relation to their relevant department procedures. This training, which is specific to our organisation and to our operations in the US, is not readily available in the UK, as we have no current operations running of a similar scale in the UK.

All expenses related to the trip are fully covered by Whole Foods Market/Fresh & Wild including airfare, lodging and per diem expenses as permitted under UK law. Visiting support Team Members continue to be paid from the United States and they are not in the UK to undertake any productive work. “

Reply to this comment

Is Whole Foods Market’s John Mackey up to his old tricks? 7 August 2007 20:50, by Jack Sonoma
This is a very interesting spin put out by Whole Foods as it is well known in these parts that going over to the UK will be some of the hardest days that you will work for the company whether it be wrapping cheese, stocking shelves, hauling trash through the store or working in the food hall. From what I heard, US Whole Foods Market Team Members have been instructed by the Regional Office to inform Customs Officials that they are only going over for seminars in order to avoid paying for UK Work permits. I don’t know how they can justify this clear misrepresentation of the truth but I am sure it wi

Anonymous said...

Thanks for the inside scoop, Steve. While the CSAs (the bizarrely Communistic acronym we have for such recurring, farmer-direct purchases) can be great, they are also impossible for tourists like Jack to purchase, hence his being underwhelmed.

As Whole Foods bulks up in the UK, perhaps Michael Pollan’s book and the issues it raises (such as “industrial organic”) will find a foothold there.

Brilliant TV dinner analogy!

On July 3rd, 2007 at 2:31 pm ,Nick wrote:

I have seen the store…it’s empty! Sadly it looks like it wont make it. I suspect they have pitched the prices too high.

On July 3rd, 2007 at 2:35 pm ,Dr. Vino wrote:

Oh really? Someone wrote that the London store was really full on the opening day (maybe traffic ebbed after that?). And I thought “prices too high” and “London” were an oxymoron!

On August 7th, 2007 at 3:30 am ,Bye the Bye wrote:

Nick is right,the store under its present style has no chance. Its breakeven is about £500,000 a week and as nick says the store is almost always empty except for Saturday and Sunday, which indicates it is more a destination than a day to day experience.
Mind, they have not helped themselves by shutting the old Barkers arcade entrance and the Young Street one and by posting Security Guards dressed in black at the front door.
The prices are high, but the prepared food is just awful and sits all day stewing in hot servers. The cold prepared deli food is like something from the 70’s and the cold meat sits for days.

How ridiculous is that for cheese and wine.

On August 7th, 2007 at 11:38 am ,Steve wrote:

I would imagine that Nick and Bye work for the competition especially given the detailed critique of the entryways, foot traffic and business plan.

The prices can be high (in the US they are known as Whole Paycheck) but take a look at the produce, cheese, bakery, butcher and fish monger. They are all far superior to any UK supermarket.

If you are indeed part of the competition, please look carefully and learn.

On August 8th, 2007 at 2:38 am ,Bye the Bye wrote:

Well I certainly dont work for the competition, but I do work near them and I can analyse business viability and in this case it is not too difficult given the lack of customers. In addition you cannot create profit from Bread, Cheese,meat and fish unless you have huge numbers of customers buying huge quantities of food like in USA.
The quality is not vastly better than local Waitrose, M&S etc. but one aspect you are correct in is it does take your whole paycheck !

On August 8th, 2007 at 8:04 am ,Steve wrote:

It looks like we have different ideas about what makes a good supermarket. Waitrose is an excellent supermarket but their produce, meat, fish and bakery departments could improve. M&S is a joke and exactly what Jamie Oliver and Gordon Ramsey speak out against - it’s 100% ready meals!

Also, I guess nobody told our local (SW6) bakery, fish shop or butcher that they can’t make money. Doh!

On August 14th, 2007 at 3:55 am ,Bye the Bye wrote:

Do the math!!! £500,000 a week minimum breakeven requires a lot of customers spending a lot of money and there arent a lot of customers there,so you have to either start again or use it to offset your tax liabilities elsewhere.
SW6 retailers make money because they know their market. Wholfoods didnt,doesnt and will ultimately either have to learn or pay the price of all failed ventures.

On August 14th, 2007 at 6:31 am ,Bye the Bye wrote:

Print | Save | E-Mail | Rate | Comment


Mail on Sunday; London (UK), Arrival Time: 2007-07-30


from 1 user(s).

Billed as the supermarket to change the way the British shopped, the food was fresh and plentiful, the presentation perfect and the organic credentials shouted from the shelves. But Whole Foods Market, the US giant that opened the doors of its London flagship store with a blaze of flattering publicity last month, is said to be dumping skiploads of food.

It also faces a barrage of official complaints about its labelling and the provenance of its produce.

According to industry sources, the store has sales of only 500,000 a week, a third of its projected breakeven target. And though it impresses with 21 varieties of tomatoes and 400 types of cheese, many customers have balked at the store’s higher-than- average prices.

Notable examples from the launch were cherries being sold for 11.99 a kilo and a single prawn skewer priced at 8.99.

When Whole Foods had its grand opening, it drew crowds of health- conscious, environmentally concerned and inquisitive customers, many attracted by its promise of additive-free, ethically sourced produce.

Almost two months later, the crowds have disappeared. Chiller cabinets in the shop in Kensington, west London, that once groaned with fresh produce, have been given over to soft drinks. On Friday, during peak after-work buying hours, fewer than half the tills were open to serve customers wandering the three floors of the 80,000 square foot store.

Richard Hyman, chairman of retail analyst Verdict, said: ‘The store is not going to work because it is miles too big. It is a vicious circle there is a high proportion of wastage because there is so much fresh food, but that pushes the prices up. Getting rich people in Kensington to shop there is not difficult, but getting enough bums on seats to sustain 80,000 square foot of sales is impossible.’

On August 14th, 2007 at 8:25 am ,Steve wrote:

Lots of fresh food? Harrumph!

We’ll put an end to that!

Can’t these silly Americans see the wisdom of ready meals? Get the press on them, boys!

The Sun, sir?

No let’s pull out all the stops - THE TELEGRAPH!!



3 years later, a plaque is erected:

On this spot Her Majesty’s right brave honorable and loyal Subjects battled an unwelcome and most odious menace, saving London from a relentless and bewildering onslaught of Fresh Food.

On August 14th, 2007 at 8:53 am ,Bye the Bye wrote:

Fresh….not after it has sat mouldering on the shelves for more than a week.
M&S do have the measure of British taste…hence their success and their rival’s inability to convert us to Mung beans and 24 varieties of tomatoes..have you tasted WF’s peanut butter….if thats good for you make mine Skippy !

On August 14th, 2007 at 9:55 am ,Steve wrote:

Yes that Whole Foods peanut butter is truly diabolical! It tastes like – egads – fresh roasted peanuts! Haven’t these peolple heard of sugar and partially hydrogenated vegetable oil? And don’t they have the decency to run it through a proper factory?!

On August 14th, 2007 at 10:11 am ,Bye the Bye wrote:

Exactly !! although I could argue the fresh roasted bit…The coffee yes, the nuts have been there as long as me! Who wants to eat that rubbish when we have ALL been brought up on Skippy!
But seriously check this out