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Whole Foods Uses Boulder, Colorado, As Testing Ground Of New Concepts

Whole Foods has moved quickly to reassure the Boulder, Colorado, community of its commitment to the area, an important task as Boulder is both the headquarters for Wild Oats and an important market for Whole Foods and Wild Oats.

The comeuppance? No Wild Oats stores will close — at least for now — but a large Wild Oats flagship store that was just completed will never open. The plan is now to sell or lease that store to a non-food retailer. This store was supposed to be something special:

Wild Oats will open our new signature Twenty Ninth Street store in our hometown of Boulder this spring. The Twenty Ninth Street store will be a brand new look, feel and design for Wild Oats. Not only is the store’s interior going to be incredibly unique, state-of-the-art and like nothing you’ve seen before — complete with a cooking school, expanded foodservice department and upscale wine and spirits shop called Vino 29 — the store is part of Boulder’s new Twenty Ninth Street development.

Wild Oats is the first food retailer in the nation to pursue third-party LEED® certification through the LEED Retail Pilot program of the US Green Building Council (USGBC). The LEED Green Building Rating System is the national benchmark for the design, construction, and operations of high-performance green buildings and stands for Leadership in Energy and Environmental Design. The Twenty Ninth Street Wild Oats Marketplace is an inviting showcase of high performance, energy efficient systems; healthy indoor air quality; natural daylighting; and non-toxic, environmentally friendly building materials.

Built with the environment and our customers in mind, this store will be a food lover’s dream.

Now we will never know.

An existing Whole Foods store will expand to 73,000 square feet and thus become the largest Whole Foods in Colorado. An existing 34,000-square-foot Wild Oats flagship store will be converted to a Whole Foods Market.

Perhaps more interesting is that Whole Foods seems to be using the acquisition to experiment. In some ways that may have national implications.

On the one hand, there seems to be a move toward localism. Whole Foods is planning to keep open Ideal Market, a 65-year-old store that Wild Oats ran as a kind of hybrid between a superette and a Wild Oats.

Whole Foods promises “significant upgrades” to the Ideal Market format. It is said that the name is sufficiently iconic in Boulder, so Will Paradise, the Regional President for Whole Foods, said he didn’t want to be known as the man who closed the Ideal Market.

Continuing with the local theme, another store will be renamed Alfalfa’s in tribute to its heritage, as it was, originally am Alfalfa’s store. To what degree it will differ from a Wild Oats, other than in name, is unclear. At one point, the founders of Wild Oats, Michael Gilliland and his wife Elizabeth Cook, explained the differences between the concepts to a Denver reporter:

Gilliland explained to Tammy Tierney of Denver Business Journal, “They take the high end; we take the low end. We have lower prices, are more low key, and are not so inclined to gourmet items.” Elizabeth Cook expanded on the difference to Tierney, “We’re a hard-core natural foods store. They concentrate on food service. We concentrate on bulk and mainstream grocery.”

Hmmm … Alfalfa’s was “inclined to gourmet items” and would tend to “concentrate on foodservice” — sounds like the new Whole Foods in London, or any of its larger stores.

If keeping Ideal and converting to Alfalfa’s are local twists, another move clearly has national implications.

A small store, the original 1987 full service Wild Oats store, is going to become a Whole Foods Market Express, which Whole Foods describes this way:

The Baseline Road Wild Oats Markets (18,500 sq. ft.) store will be converted to an entirely new experimental concept for Whole Foods Market entitled “Whole Foods Market Express.” This new convenience-focused concept for the company will offer a value-oriented product mix, grab-and-go offerings, and will be a practical fit for its neighborhood, especially with the high concentration of University of Colorado students nearby. Whole Foods Market views this new “Express” concept as the type of innovation that is especially true to Boulder’s natural and organic products industry roots.

Wild Oats probably has around 35 stores that could instantly roll out this concept if it works, and this might give a clue as to why Whole Foods, which has been concentrating on large foodservice-oriented stores, even wanted Wild Oats.

It also seems to be a concept similar to Tesco’s Fresh & Easy Neighborhood Market concept, just as Wal-Mart’s new small footprint “Urban Convenience” concept also appears to be a contingency plan in case Tesco hits with consumers.

Most supermarket and supercenter retailers are constrained in their growth by the lack of availability of large sites, whether they are 200,000 square foot supercenters or 80,000 square foot large foodservice-oriented supermarkets. So if the small-footprint stores pay, we can expect a boom as America’s food retailers attempt to preempt local competition by rolling out fast.

For Whole Foods, that rollout may well depend on Boulder.

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