NEW YORK (AP) — Whole Foods cut its profit outlook for the third time in recent months on Tuesday, signaling the intensifying competition the grocery chain is facing in the market for organic and natural foods.
The company, based in Austin, Texas, has grown in popularity by positioning itself as a purveyor of wholesome foods. More recently, however, its dominance among the healthy-eating set has been challenged as traditional supermarkets, big-box stores and even online retailers step up their organic and natural offerings.
"For a long time, Whole Foods had the field to ourselves. That was nice. But the reality is that we don't anymore," said John Mackey, the company's co-founder and co-CEO, in a conference call with analysts and investors.
Whole Foods' stock fell almost 14 percent in after-hours trading Tuesday.
Still, Mackey stood by the company's growth potential.
To appeal to a wider base of customers, Whole Foods Market Inc. has been trying to keep its prices down, in part by pushing its more affordable store brands. Those store brands are also designed to cultivate loyalty, since customers can't find them elsewhere. But most major retailers including Target and Kroger are using a similar strategy of dangling spruced up store brands.