Is The Market In Whole Foods-Wild Oats Bigger Than Just Supermarkets
As the Court repeatedly stated in its opinion (which Antitrust Review linked to previously), market definition is key. The FTC contended that the relevant product market was “premium and natural organic supermarkets” (PNOS). Whole Foods believed the relevant market included all supermarkets. The Court agreed with Whole Foods.
I wonder if the market should be bigger. I regularly shop at a Whole Foods (it’s a 5 minute drive/15 minute walk away) and at a Giant (also a 5 minute drive/15 minute walk away). In addition to purchasing produce, meat and fish at Whole Foods and Giant, I also purchase these items at local farmers markets and from a CSA.
I am not alone. As the following chart from the USDA shows, the number of farmers markets is growing rapidly; for example, from 2004-2006 there was an 18.32% increase (and around an 80% increase from 1996 to 2006).
CSA stands for Community Supported Agriculture. In short, you buy a share in a local farm and receive a weekly share of the farm’s output. Mine is Bull Run Mountain Organic Farm (its question page provides detailed info on how the CSA works); and, as it happens, it is one of at least three CSA’s which have a drop off point within 3 blocks of the Whole Foods near me. I did not find a USDA stats on the growth of CSA’s but the number has ”seen tremendous growth in the US“ and could “triple or quadruple” in the next few years.
Despite the past and likely future growth in farmers markets and CSA’s (and I assume that growth in the number of farmers markets and CSA’s results in growth of the amount of goods sold) neither were mentioned in the Court’s opinion. Perhaps their presence in the market is not large enough (compared to supermarkets) to warrant mentioning (my guess); nonetheless, if I sold produce, I would be worried about the rapid growth in farmer’s markets and CSA’s.
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August 24th, 2007 at 12:49 pm
Any store that carries potato chips and red bull satisfies all my grocery shopping needs.