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This Forgotten Whole Foods Story Offers 1 Valuable Lesson For All Entrepreneurs

Founder and CEO John Mackey never set out to start a “normal” company, and it’s made all the difference.

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BY Carmine Gallo - 19 Jun 2017

PHOTO CREDIT: Getty Images

Lost among the media coverage of Amazon's $13.4 billion purchase of Whole Foods is the fact that the organic grocery chain barely survived its first year in business. How it recovered is a lesson in purpose-driven entrepreneurship.

On Memorial Day in 1981, Shoal Creek in Texas spilled its banks, covering parts of the city of Austin in over eight feet of water. It was Austin's worst flood in 70 years. The first Whole Foods store on the 900 block of North Lamar Boulevard was hit especially hard by raging floodwaters. The water destroyed everything. The store had opened a year earlier, and its owners did have flood insurance.

Just when all seemed lost, something unexpected happened. The store's employees refused to let it die and its customers refused to let it go. They showed up with mops, buckets, and shovels--completely voluntarily, for no pay or expectation of a reward. In his book, Conscious Capitalism, Whole Foods founder John Mackey says he was amazed and surprised at the level of support he received.

"Why are you doing this?" he asked a volunteer.

"I'm not sure if I would want to live in Austin if the store wasn't here. It's made a huge difference in my life," the customer said.

Employees and volunteers were covered in mud, but they worked tirelessly until the founders worked out a loan and restocked. The store re-opened a month later.

In his book Mackey asks the question, "How many 'normal' businesses would attract a volunteer army of customers and suppliers to help them in their hour of need?" The answer--very few. And that's because normal companies don't attract love, loyalty, and devotion. But purpose-driven companies do.

The Whole Foods Missionaries Who Retail

"Your brand is just the way people think about the company or the product, so I don't think the brand is more important than the purpose or the values of the organization, Mackey once said in an interview. "We're not retailers with a mission, we're missionaries who retail."

Mackey never took a single business class in college. Instead he took philosophy, religion, history, and literature. He pursued his passions, the same advice he gives entrepreneurs today.

"I made a lifelong commitment to follow my heart wherever it led me," Mackey wrote in his book, saying that his heart lead him to sell natural and organic foods--a calling that gave his life purpose and a mission. "Our purpose is to teach people what they put into their bodies makes a difference to their health ... and to the health of the planet as a whole."

According to Mackey, purpose gives you and your company energy. It makes the company relevant to people's lives. Your purpose must be abundantly clear to you, your employees and your customers. Without purpose, you're just another company. With purpose, you find your way into people's hearts.

The challenges that Whole Foods has faced in the past few years have been well documented. It's been squeezed by rivals who offer organic foods at lower costs. The brand has seen same-store sales and stock price declines and has come under fire from activist investors.

Amazon's ownership might reinvigorate the brand. It has 460 stories, it will retain its name, and Mackey will stay on as chief executive.

Regardless of what happens next, the Whole Foods story holds an invaluable lesson for all entrepreneurs in every category. The lesson: No customer or employee is going to voluntarily pick up a mop to help you clean up after a "flood" unless they've bought into your company's higher purpose.

Your employees come to work for a paycheck. They go the extra mile because they're inspired by your company's purpose.

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