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Whole Foods CEO finds the conversation quickly turns to his politics

January 23, 2013 3:00 am by | 0 Comments

health reform protest

SAN FRANCISCO -- Whole Foods CEO John Mackey doesn't like to mix business with his private life, but after the release of his new book got lost in a heated political debate about health care, things got more personal than Mackey says he ever intended.

Mackey was in San Francisco and Cupertino this week on a national tour to promote his just published book, "Conscious Capitalism," which argues for the inherent good of business and capitalism. But in the Bay Area, as in many of his recent public appearances, the conversation quickly turned to Mackey's opinions on government regulation, health care reform and gay marriage.

That wasn't what Mackey wanted to talk about. He was there to sell his book and -- to those not already loyal shoppers -- the Whole Foods brand.

"I'm so tired of being attacked for my political views. And I'm so tired of making people upset with me," he said during a question-and-answer session at the San Francisco Whole Foods on Tuesday.

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Public opinion about Whole Foods, he said, "shouldn't be about politics or gay marriage or abortion," he said. It should be based on, well, the food.

The kerfuffle started last week when Mackey called President Obama's health care reform "fascist" during an interview on NPR's Morning Edition. He quickly walked back his criticism, and while he doesn't agree with the new health care law -- he says the government should stop regulating health care and let it compete in the free market -- he conceded that "fascist" may not have been the best word. But on Tuesday, it appeared Bay Area Whole Foods patrons hadn't forgotten about the comment.

When an audience member probed Mackey for his thoughts on government regulation, the CEO hesitated.

"I'm probably conscious of where I am right now," Mackey said, referencing the largely left-leaning Potrero Hills neighborhood where he spoke.

Mackey's public relations quagmire isn't his first. Although he's soft-spoken and vows discretion about his personal views, he has frequently pontificated publicly about other thorny issues such as climate change and has been in the hot seat with animal rights and labor groups. Mackey is, in many ways, at odds with the grocery business he started 32 years ago.

He espouses conservative views on government regulation and free enterprise while serving a customer base often described as the tree-hugging, granola-eating kind of shoppers who tend to lean left of the political aisle. He's a vegan who spends huge amounts of time and money to stock his stores with high-quality meat that meets specific ethical standards. He's a self-described libertarian who wants to set up nonprofit grocery stores in underserved areas. And he opposes Obama's health care reform, while offering full health benefits to all Whole Foods employees who work 30 or more hours.

"Mackey continues to set his own rules," said Phil Lempert, industry analyst and editor of SupermarketGuru.com. "Sometimes it works, sometimes it doesn't work."

But he's not in danger of losing his customer base.

Whole Foods shoppers "are loyal and can afford to shop wherever they want and want to buy organic and buy whatever (Mackey) is selling," Lempert said. "That's not America, and that's not even the entire Bay Area."

While Mackey, 59, has had his share of falling outs with Whole Foods' liberal following, his impact on the supermarket industry is undeniable. Leaders of some of the nation's largest supermarket chains say Whole Foods disrupted the industry with its organic inventory and immaculate stores. Whole Foods was one of the early competitors that forced traditional grocery stores to rethink the way they do business. Safeway, for instance, has rolled out its own organics line and a private-label line of all-natural foods.

"When we got into this, these guys weren't selling organic foods," Mackey said. "And their stores looked like hospitals wards. They were all sterile and fluorescent lights, and ugly. They've all copied us."

With organic foods easier to find these days and new players crowding the supermarket landscape, Mackey finds himself up against new competition. The threat isn't the national chains but regional grocers, including Sprouts Farmers Market, Trader Joe's and The Fresh Market.

In spite of the competition, Whole Foods remains one of the most expensive organic and natural foods retailers.

"What every other retailer has done is learn from Whole Foods, and they have their own organic foods and seafood sustainability programs," Lempert said. "They've learned they can pick and choose what they want to do without raising prices to the point of Whole Foods."

But Whole Foods is staking out its turf, with plans to expand its empire of 340-plus stores this year. Whole Cities, the company's third nonprofit foundation, which is still in the planning stages, will prop up a network of low-cost stores in underserved areas. Mackey said the stores will give residents access to fresh food for cheaper than Whole Foods prices, and any profits would be returned to the community. The company is looking to build in Oakland, Chicago, New Orleans and Newark, N.J.

Philanthropy has been a vital part of Mackey's business philosophy, and he says it is an example of the social service every business should be performing. His convictions are so strong, they led him to write "Conscious Capitalism," his first book.

"Every business has the potential to have a higher purpose than just making money," he said. "Not that there's anything wrong with making money. A business can't exists unless it makes money, but that doesn't have to be its purpose."

Another thing about Mackey -- he likes to give away money, but he also likes to make it. What started as a small natural foods store in Austin, TX, where Mackey lives, has grown into a $12 billion corporation. Mackey said there are other businesses out there like his -- that care about making people healthier, happier and better -- but there could be a lot more.

"I do think (businesses) have a better way, and I care," he said. "I can't help it; I'm an idealist."

Contact Heather Somerville at 925-977-8418. Follow her at Twitter.com/heathersomervil.

five things about John mackey

- He's a vegan, and has been for 10 years

- He has hiked the Pacific Crest Trail, Appalachian Trail (twice), John Muir Trail in California and dozens of peaks in the Rockies and Sierras.

- He ranks San Francisco the second-best vegan city in the country (after New York City). His favorite vegan restaurants in San Francisco include Millennium, Gracias Madre and Cafe Gratitude.

- He considers the Bay Area the nation's leader in food innovation and the eating local movement

- He supported Proposition 37, the state ballot measure to label genetically modified foods that was defeated in the November election. ___

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By Somerville, Heather

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