>> Whole foods, whole paycheck. The grocery chain, hoping to finally put that joke to rest, with the debut of its discount 365 chain on Wednesday. A response to intense competition from offbeat brands like Trader Joe's, traditional supermarkets like Krueger's, and newer entries from Walmart and Amazon. Reuter's correspondent Lisa Bartline was at the opening of one store in Los Angeles.
So this store was a bit of a surprise. The pricing is very simple. They are doing by the pack. They are offering conventional and organic pricing. They are doing flowers at $5 and $10 price points. They have a wine selection that is under $20 for the most part.
And they only have about three or four of the same products. So when I go to Whole Foods, there's a wall of olive oil, here there's only a few.>> At 365 not only is the selection pared down, iPads will replace Whole Foods food and wine experts. And there's no one manning the cheese and fish counters, it's all grab and go.
Whole Foods is touting these stores as an affordable alternative to the brand that's been associated with organic and natural foods, with a premium price tag, taking aim at budget gourmets and cash-strapped millennial moms. But it'll be a tricky balancing act.>> Some retail experts say they worry about this chain because they fear that customers from Whole Foods will start shopping here.
And that will force Whole Foods to bring their prices down in their main stores where the cost of running those stores is much higher. And it will just kill Whole Foods' profits if that happens.>> Whole Foods found itself at the center of a firestorm last year, charging six bucks at its flagship stores for a bottle of water with a few stalks of asparagus in it.
In December, the company reached a $500,000 settlement with the Department of Consumer Affairs for overcharging for pre-packaged foods priced by the pound, sometimes by as much as $15. Whole Foods, trying to move past its bad press on prices, said recently it's signed 19 leases for 365 stores around the United States.