Whole Foods’ decision not to build a new store, but to refurbish the old Minyard’s, has nothing to do with us, the difficulty — or not — of making any zoning changes, and most of the other assorted topics that have been discussed here.
I’m going to have more on this in my March magazine column, but know, for now, that this was almost certainly a decision made in Austin by Whole Foods senior management (and perhaps even by Whole Foods uber-boss John Mackey). One scenario: They saw increasing competition in this part of town from Aldi’s (and perhaps even Sprouts) and decided to open the new store in four to six months instead of 12.
That’s the analysis of my grocery store consultant, who is based on the West Coast and has worked with most of the big national chains. He asked to remain anonymous for those reasons.
"These sorts of things happen all the time," he says. "You get a piece of real estate, and you’re going to develop it, and then something happens and it doesn’t get done. It’s a big deal to the people in the neighborhood, but it’s not a big deal to a company with hundreds and hundreds of stores."
Then, he says, 12 or 14 months later, during a store development progress meeting with senior management, someone notices that the store that was supposed to be finished is still 12 months from completion. "And that," says my guy, "is when someone says, go to Plan B. And that happens all of the time, too."
In other words, Whole Foods — which in the past 12 months fought and beat the Federal Trade Commission and neared completion of an 80,000-square-foot megastore at Park Lane and Central — had more important things to worry about than our store. And, then, for whatever reason, it didn’t.
The company’s change of plan apparently had very little to do with the zoning changes that so many people here feel so strongly about, on both sides. Even if everyone in this part of town had thought Whole Foods deserved its variances, it still would have taken till summer to get through the system. And Whole Foods didn’t want to wait.
Don’t forget that the company knew it needed a variance in February 2007 when it announced the deal for the Minyard’s lease. It should have known then that the process would take four to six months. But it didn’t work on the zoning effort then, because it had other things to do.
Whole Foods declined to be interviewed about its decision, so much of this is an informed guess. But my grocery store guy says he has seen situations like this in the past, as odd as it may look to us. One clue to the company’s thinking came in the emails announcing the decision: "We simply cannot afford to sit on the property for another 6 months to a year before we can begin work on the site. It is strictly a business decision."
If the company had not been battling the FTC or devoting so much time and money to the Park Lane project, it might have had the resources to get the zoning kinks ironed out of this project last spring. But, apparently, it didn’t have the resources. And that has nothing to do with setbacks, store facings and the planned development rules that govern building on the site. Whole Foods, despite its reputation, is not perfect. It makes mistakes, like announcing the new store would be finished in 10 months and then not finishing it.
The other thing to keep in mind, says my source, is that just because Whole Foods isn’t building now doesn’t mean it won’t build in the future. It’s entirely possible that after a couple of years, it will put up a new building. And again, as unusual as this may sound, my guy says it also happens all the time.
But whatever happens, keep in mind that it has very little do with us, and a lot to do with the difficulties inherent in running a $6.6 billion company with almost 300 stores in three countries.
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