The 60/30/10 Ratio With Whole Foods Market’s John Shaw
My conversations going behind the scenes with retail decision-makers about how they build and manage business relationships with their suppliers continue with the exciting addition of John Shaw.
John has been working in the retail and global supply chain arena for over 15 years, leading teams at Whole Foods Market, Walmart, Ahold Delhaize-Peapod, and eGrocer Farmstead. John has led teams from start-up to Fortune 1, including roles as Vice President of Exclusive Brands (Private Label) at Whole Foods, Chief Merchant at Farmstead, and leading fresh legacy initiatives at Walmart over sourcing, strategy, and category management. He has a passion for this industry and was generous with useful tips and insights.
KAREN NARDOZZA: WHAT INSPIRES AND FUELS YOU IN THIS INDUSTRY?
John Shaw: As a naturally curious person, I enjoy building things and the prospect of creating something bigger than myself is inspiring. In sourcing produce and other commodities from all over the world, I’ve been able to do just that. In the course of my career, I truly fell in love with food and the people who make it. This industry continues to give me opportunities to partner with other creative people and explore new technologies—plus I get to meet farmers, producers, and growers all over the planet. I love the storytelling aspect and the opportunity to bring products to life and to build great customer experiences.
I’m also inspired by exploring innovation and connecting people. How do we source better? What is the next exciting item? How do we leverage size/scale better? How do we fit this all together to create a sustainable, better, healthier future? Retail is a personal passion, and I feel fortunate to make it my career.
KN: YOU’VE WORKED WITH SUPPLIER AND PRIVATE LABEL BRANDS—HOW DO YOU POSITION THEM BOTH?
JS: Both serve a critical role for growth. An effective strategy I’ve used is a brand architecture of good, better, best. This started with Walmart and gave me a framework to think about the category structure. Good represents the value of products—everyday essentials, the opening price point, the “basket builders.” Better are slightly elevated brands with added value or a special feature that offers something extra for core or occasional shoppers. Best are premium, higher-priced products. This tier feeds consumer discovery and culinary inspiration, includes source and origin stories, and features beautifully designed or unique packaging. This structure provides value, options, and room to explore within a category. Each category should have a slightly different blend depending on the category’s role and retailers’ strategy.
KN: HOW DO YOU CHOOSE WHICH SUPPLIERS TO WORK WITH? WHAT ADVICE WOULD YOU GIVE A SUPPLIER WHO WANTS TO SUCCESSFULLY PITCH THE KIND OF LARGE RETAILERS YOU’VE WORKED WITH THROUGHOUT YOUR CAREER?
JS: I get approached often by folks looking to become suppliers. I use a 60/30/10 split where 60 percent makes up the core assortment, 30 percent is regional, and 10 percent is hyper-local or innovation. Understanding where you fit within this structure is important. Relationships are also vital. Find someone who knows someone within the company because that mutual contact will give you credibility. Do your homework. Research the retailer’s strategy and gaps. What is their buying process? What teams are involved? Ask for the steps. Ask questions. Do they have a gap you can fill? What are their overall goals and the type of shopper they serve? Every retailer is different. Walmart, for instance, is health-minded, but their strategy is providing affordable products to the masses with “every day low cost” so price and scale will be a priority. Whole Foods, on the other hand, is a natural and health products retailer for people seeking healthy food options. Whole Foods requires strict quality standards and leans into “functional, better for you” options. Research each retailer, be consistent with communication, and tailor your pitch to meet their needs and niche.
“I love the story telling aspect and the opportunity to bring products to life and to build great customer experiences.”
KN: WHAT OTHER HOMEWORK SHOULD SUPPLIERS DO?
JS: Hone their story. Telling your own, distinctive story is important. Help the buyer visualize your product, the role it plays within an assortment, and build emotional connection. Tell your story with great branding and strategic packaging. Your pitch deck and ongoing conversations should always have relevant data and key metrics that drive business forward. Be persistent and patient. The buying process typically starts a year in advance, so start early.
But winning the bid is just the beginning. Protect your retail relationships by actively communicating and monitoring performance—meet quality standards, fill rates, performance, and timing. Support your retailer with promotion opportunities and in-person events at stores. Get creative, build a partnership, and show your commitment.
KN: ANY THOUGHTS ON THE EFFECTS OF INFLATION?
JS: Inflation is a challenge for everyone right now, but retailers cannot continue to pass all the extra cost on to consumers—they will leave, buy less, or trade down. Now, more than ever, do your homework—focus on the consumer, demographics, and what’s most important to them. Retailers often leverage commodity intel to lock in prices. Open bids, look for ways to remove certain attributes to mitigate costs or tell the story of why a certain product is higher quality to justify costs. Elasticity also plays a large role in customers’ buying patterns.
KN: WHAT DO YOU THINK ABOUT FOOD AS MEDICINE AND FUNCTIONAL FOOD TRENDS?
JS: I’m an active person and health-conscious, so I think it’s a fantastic trend! I’m passionate about functional foods that maximize health, energy levels, and help us be our best selves. As a former Board Member at United Way, I know that over 11 million kids live under the poverty level in the United States. This is directly linked to a range of health problems, cognitive delays, and educational challenges for those kids. Eating healthy foods can make a huge difference in their future. Today, we have a great variety of products to help us be our “best selves.” Some fun items I’m seeing are functional teas, coffees, and sparkling drinks. There are also innovative plant-based products that are trending right now.
When I asked John if he had any final thoughts to share, he said to embrace the journey—retail can be a roller coaster but a lot of fun. If you can tell authentic stories and build great relationships, you will have success. Just remember not to be afraid to take risks and move quickly.
It continues to be both interesting and inspiring to have these candid conversations with the key decision makers taking on the adventurous ride of buying and selling fresh produce, and I am so grateful to have been able to do so. My thanks to John for wisdom those of us on any side of the business can benefit from!