October 26, 2006
Odak Out, Industry Vet Takes Helm at Wild Oats
Perry Odak is now the former CEO of Wild Oats and the company’s chairman, Gregory Mays, a long-time supermarket industry veteran, will take over the position on an interim basis.
Mr. Odak joined Wild Oats in 2001 after having been the CEO and president of Ben & Jerry’s for four years. Recently it has been reported he was involved in negotiations to extend his contract but the parties were not able to come to an agreement. He will stay on for an additional 90 days to help with the transition.
Mr. Mays became chairman of Wild Oats shortly after joining the company’s board in July. He has 33 years in the industry, having worked in executive positions at Ralphs Grocery Co., Food 4 Less Supermarkets, Alpha Beta Stores, Almacs’ Supermarkets and Cala Foods.
Wild Oats has established an executive committee comprised of Mr. Mays, along with Brian Devine, chairman of Petco, and John Shields, a member of the company’s board since 1996 and its non-executive chairman for eight years.
“We are grateful for the leadership and direction provided by Mr. Odak during his time here. He stepped in during a difficult period, executed a successful turnaround and helped establish the Company as a true lifestyle brand,” said Mr. Mays in a company press release. “My colleagues Brian Devine, John Shields and I are united in our goal to ensure that Wild Oats will have the tools needed to continue to grow the business. As a major natural and organic food retailer in the industry, we will continue to focus on building meaningful connections with our customers.”
Reinforcing his interim role, Mr. Mays said, “We are in the process of establishing a timetable to name a new CEO. We plan to commence a diligent search that will identify a candidate who understands our customer base and will lead this company and brand into its next phase of growth.”
Discussion Question: How will Gregory Mays and the influence of Yucaipa Cos. affect Wild Oats in the post Perry Odak era?
Mr. Mays came to the board of Wild Oats as a result of his relationship with Ron Burkle, managing partner of Yucaipa Cos. The investment firm bought an
initial stake in the natural and organic foods supermarket chain last year.
BrainTrust
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Wild Oats is a perfect example of a retailer that’s lost its way – and for a very good reason!
Natural and organic foods still have no scientific validation that they are better for us. Better for the environment, perhaps, but not definitively proven healthier for human consumption. Natural and organic foods haven’t even been in wide enough distribution over a significant period of time to even begin to conduct clinical, lifetime studies. Instead, they are most famous for supposedly bad stuff that they don’t contain. The FDA still offers no definition of either.
So, what did/does Wild Oats stand for? If it’s simply selling more stuff to the converted, then that’s a limited market. If it’s convincing consumers to switch to natural and organic foods, then they failed soundly in that endeavor.
Wild Oats is a perfect example of a retailer that’s lost its way–and for no good reason!
Wild Oats typically had terrific and knowledgeable employees, and a strict policy for accepting products that met their criteria. Years ago, many thought that, in the race between Whole Foods and Wild Oats, the latter would actually be the winner. Fast forward…today they are left in the dust.
But there is an opportunity to survive. Their store within a store concept with Albertsons may be their route to survival–if they focus on that concept. And focus has always seemed to be their problem.
It will be interesting to see now that Wild Oats is firmly in the hands of people with a traditional grocery background (Mays, Burkle) if the company will make changes in its logistics, buying and in-store operations.
Will Wild Oats install self-checkouts in its stores? Will it look to reduce its workforce in numbers or hours?
Will Wild Oats turn to more traditional distribution partners such as Supervalu instead of natural foods wholesalers? Ron Burkle’s Yucaipa Cos. has a 12% share of Supervalu.
Will the company bring in more natural and organic products produced by large CPG manufacturers?
Will Wild Oats be willing to accept lowered standards for organics and natural items to lower its prices? Some have accused Wal-Mart of doing this very thing.
It will be interesting to see what comes next.
In five years, Wild Oats’ stock rose from $8 to $18. Whole Foods rose from $17 to $65. So Wild Oats didn’t please investors as much as Whole Foods, but Wild Oats sure pleased investors more than many other retailing stocks. The category has such high growth, leading to such high expectations, from customers and investors alike. In every category someone has to be #2, but that doesn’t mean #2 has to be awful.
Many years ago, it would have seemed that there was indeed a race between Whole Foods and Wild Oats to see who would get to the top of the mountain first … no surprise now that Whole Foods is clearly king of that mountain. Is there room in the natural foods arena for another player … absolutely, but Wild Oats has a lot of catching up to do.
With Burkle veteran Mays at the helm, they are on the right path to turn this ship around. Burkle and his stable of industry vets seem to have the golden touch when it comes to taking a operator to the next level when they get stuck on one plateau. The Burkle camp may be spread a bit thin these days with minority interests in Pathmark, SuperValu and Wild Oats…but even that said, look who’s in the driver’s seat. If I were picking teams for a little game of “Get the retailer back on their feet” I would surely pick Burkle and/or his group to be on my team if I were looking to win. I look forward to what will come out of a Mays run Wild Oats…stay tuned.
If Wild Oats goes the grocery method(s) route, the charm and niche positioning will be meaningfully impacted, if not lost.
It is the balancing of consumer focus and supplying fresh and organic type products that makes the natural foods supermarkets distinct, not the mass selling and price approach.
Unfortunately, Wild Oats needs some image building and store remodeling for its first strategic move. Hmmmmmmmmmm
With mass retailers such as Safeway, Wal-Mart, and countless other smaller chains entering the natural and organic market, Wild Oats will have to get their act together quickly. Every day I speak to, or hear about more competition investing in this channel.
Wild Oats’ internal marketing has become more and more aggressive to the point of starving excellent vendors to non-profitability. It seems the executive push lately has been so focused on the bottom line for Wild Oats that they seem to be forgetting where their money is coming from.
Mass retailers have seen the incredible growth in the natural market and are capitalizing on this trend. Talent is being hired away from these natural oriented retailers at a fast clip. If Wild Oats does not start making it a win/win for vendors to do business with them, very soon there will be a wide selection of retailers supporting the natural/organic business model to choose from.
If Ron Burkle and his team are as good as their reputation leads me to believe, I have high hopes that Wild Oats has a good chance in holding onto, and perhaps acquiring more market share.
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Wild Oats is a perfect example of a retailer that’s lost its way – and for a very good reason!
Natural and organic foods still have no scientific validation that they are better for us. Better for the environment, perhaps, but not definitively proven healthier for human consumption. Natural and organic foods haven’t even been in wide enough distribution over a significant period of time to even begin to conduct clinical, lifetime studies. Instead, they are most famous for supposedly bad stuff that they don’t contain. The FDA still offers no definition of either.
So, what did/does Wild Oats stand for? If it’s simply selling more stuff to the converted, then that’s a limited market. If it’s convincing consumers to switch to natural and organic foods, then they failed soundly in that endeavor.
Wild Oats is a perfect example of a retailer that’s lost its way–and for no good reason!
Wild Oats typically had terrific and knowledgeable employees, and a strict policy for accepting products that met their criteria. Years ago, many thought that, in the race between Whole Foods and Wild Oats, the latter would actually be the winner. Fast forward…today they are left in the dust.
But there is an opportunity to survive. Their store within a store concept with Albertsons may be their route to survival–if they focus on that concept. And focus has always seemed to be their problem.
It will be interesting to see now that Wild Oats is firmly in the hands of people with a traditional grocery background (Mays, Burkle) if the company will make changes in its logistics, buying and in-store operations.
Will Wild Oats install self-checkouts in its stores? Will it look to reduce its workforce in numbers or hours?
Will Wild Oats turn to more traditional distribution partners such as Supervalu instead of natural foods wholesalers? Ron Burkle’s Yucaipa Cos. has a 12% share of Supervalu.
Will the company bring in more natural and organic products produced by large CPG manufacturers?
Will Wild Oats be willing to accept lowered standards for organics and natural items to lower its prices? Some have accused Wal-Mart of doing this very thing.
It will be interesting to see what comes next.
In five years, Wild Oats’ stock rose from $8 to $18. Whole Foods rose from $17 to $65. So Wild Oats didn’t please investors as much as Whole Foods, but Wild Oats sure pleased investors more than many other retailing stocks. The category has such high growth, leading to such high expectations, from customers and investors alike. In every category someone has to be #2, but that doesn’t mean #2 has to be awful.
Many years ago, it would have seemed that there was indeed a race between Whole Foods and Wild Oats to see who would get to the top of the mountain first … no surprise now that Whole Foods is clearly king of that mountain. Is there room in the natural foods arena for another player … absolutely, but Wild Oats has a lot of catching up to do.
With Burkle veteran Mays at the helm, they are on the right path to turn this ship around. Burkle and his stable of industry vets seem to have the golden touch when it comes to taking a operator to the next level when they get stuck on one plateau. The Burkle camp may be spread a bit thin these days with minority interests in Pathmark, SuperValu and Wild Oats…but even that said, look who’s in the driver’s seat. If I were picking teams for a little game of “Get the retailer back on their feet” I would surely pick Burkle and/or his group to be on my team if I were looking to win. I look forward to what will come out of a Mays run Wild Oats…stay tuned.
If Wild Oats goes the grocery method(s) route, the charm and niche positioning will be meaningfully impacted, if not lost.
It is the balancing of consumer focus and supplying fresh and organic type products that makes the natural foods supermarkets distinct, not the mass selling and price approach.
Unfortunately, Wild Oats needs some image building and store remodeling for its first strategic move. Hmmmmmmmmmm
With mass retailers such as Safeway, Wal-Mart, and countless other smaller chains entering the natural and organic market, Wild Oats will have to get their act together quickly. Every day I speak to, or hear about more competition investing in this channel.
Wild Oats’ internal marketing has become more and more aggressive to the point of starving excellent vendors to non-profitability. It seems the executive push lately has been so focused on the bottom line for Wild Oats that they seem to be forgetting where their money is coming from.
Mass retailers have seen the incredible growth in the natural market and are capitalizing on this trend. Talent is being hired away from these natural oriented retailers at a fast clip. If Wild Oats does not start making it a win/win for vendors to do business with them, very soon there will be a wide selection of retailers supporting the natural/organic business model to choose from.
If Ron Burkle and his team are as good as their reputation leads me to believe, I have high hopes that Wild Oats has a good chance in holding onto, and perhaps acquiring more market share.