Thriving on Health Food

Whole Foods has grown into the biggest organic supermarket chain by feeding on weak competition

When a tiny natural-foods market called Whole Foods opened in Austin, Texas, in 1980, it served a comparably tiny clientele: an assortment of vegetarians, macrobiotic dieters and those seeming oddballs who took supplements such as ginkgo biloba and echinacea. Like other mom-and-pop organic shops that dotted the country, the store was friendly, cozy, intensely concerned with its products' purity and expensive.

Seventeen years and a quantum market shift later, natural and organic foods own the hottest corner of food retailing, in which soccer moms mingle with ponytailed herbalists in the aisles of sparkling new stores. Sales of organic products alone, a...

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