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Sprouts Farmers Market Company’s Performance Analysis

Sprouts Farmers Market is a specialty grocery store that sells organic foods and a variety of other natural products. At present, its popularity is defined by the increasing demand for the realized goods boosted by customers’ particular attention to their health during the pandemic. This fact explains the business’s ongoing growth compared to other enterprises throughout the country, which suffer significant financial losses. Although the company used to struggle in the past due to the CEO’s resignation, it is gradually improving its performance, as can be seen from the stock price and sales.

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Through the PESTEL and SWOT analysis outlined in our report, we concluded many external and internal factors affecting Sprouts Farmers Market’s operations. Hence, the positive impact is ascribed to the favorable environment regarding the correspondence to national initiatives and legal regulations and the United States’ economic recovery, high demand, technological innovation, and sustainability. These conditions are complemented by the vast range of healthy products, efficient store design, and continuous expansion. In turn, the negative aspects of the matter include employee retention complicated by expiring contracts and the dependence on third-party suppliers.

The Mission, Vision, and Values show the company’s compliance with its statements about knowledge, the environment, employees, and local communities. The only concerns in this area are related to the lack of clarity on their workers’ conditions in the future, which should be adequately addressed. In this way, the idea of “Healthy living for less!” is reflected by the business’s overall policies. Further analysis of strategic directions reveals the intention to achieve stable growth of stores while increasing the number of distribution centers. It is underpinned by strong ethics varying by the level of participants and disciplinary action for breaking the code and sustainable objectives, such as “zero waste,” recycling, and many others.

The well-organized organizational structure with the Board of Directors at the top and the CEO promoted the development of Sprouts Farmers Market. The CEO, Jack Sinclair, is experienced in the areas of marketing, the management of retail and grocery stores, and merchandising. Over the past thirty-five years, he has been working for the industry’s major enterprises. Under his leadership, the financial indicators of the company were significantly improved. In contrast to its main competitor, The Kroger Co., Sprouts Farmers Market is better positioned regarding short-term liabilities, has higher returns on sales and equity, and its debt-to-equity ratio is much lower. It is difficult to forecast the profitability of the enterprise in the long run, but the current indicators imply its advantageous situation in the market.

The marketing strategy adopted by the company demonstrated the managers’ particular attention to detail. Thus, the realization of healthy foods and other natural products is beneficial in crisis conditions, contributing to brand promotion and future strategic growth. The creation of vast product lines consisting of perishables and non-perishables and the provision of in-store meals add to the orientation of a variety of customers and their needs. Moreover, they continuously create new offers under their own private label and thereby attract buyers. The prices are relatively low, and they vary depending on ingredients’ costs while profit margins remain the same. As for further expansion, it is ensured through advertising and building brand awareness. Considering the factors presented above, we believe that Sprouts Farmers Market is a promising business for the up and coming three years.

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