WHOLE FOODS TO ROLL OUT CENTRALIZED PURCHASING

DEENA AMATO-McCOY

AUSTIN, Texas -- Whole Foods Market will begin rolling out a centralized purchasing system this spring that will track product movement and prices, and maintain costs chainwide.

Currently, all product purchasing is done store by store, and inventory and product movement is maintained by a local database in each store. Through the new system, information such as product movement, item costs and price margins will be maintained in a database centrally located at Whole Foods Market headquarters here.

The database will feed this information down to the retailer's point-of-sale systems. "As products cross the register's scanner, all product information, such as price changes, will come from our central database," said Carl Morris, chief information officer for Whole Foods Market.

"The system will give us more consistency across the company in respect to classifying products in category management," he said. "It will also give us more control over price and cost information because now this will be maintained centrally rather than each store adding their own data into separate systems."

The first stores will be connected to the database this spring, and all 70 stores will go live on the system by year-end.

"It will be a gradual process, but we will be bringing up a region at a time starting in April," said Morris. "Since all our stores need to be on-line by the end of the year, we will be trying to bring on five or six stores per month."

Morris told SN the benefits of having a centrally hosted purchasing system will outweigh the installation costs in the long run, and save on labor costs. He also said the staff can be deployed to more productive tasks.

"Since stores do not have to maintain their price information anymore, we are planning to shift work in stores, allowing our employees to provide more activities and services geared to customers," he said.

The software for the centralized purchasing system is provided by JDA Software Group, Phoenix.

Whole Foods will use its centralized purchasing system in other areas in the future.

The system will enable Whole Foods to produce purchase orders for specific stores based on information retained in the central database. Morris said the purchase orders will save paper, and will be processed through accounts payable. Morris said Whole Foods is planning to go live with purchase orders by December 1998.