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slavin12 (< 20)

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TFM - lots of room for growth



March 20, 2013 – Comments (0) | RELATED TICKERS: TFM.DL , WFM


The Fresh Market will continue its growth for the next 5-10 maybe 20 years. Forget the financials, ignore the P/E and lets just look at "Market Brand". A company like TFM along with Whole Foods will be see a new generation of consumers over the next few decades. Several factors are already making this movement to organic food the norm in most households. 


1) The United States government along with several states and made the obesity epidemic a priority. Even the first lady has made this a primary campaign and this will be something that resonates with people over the next few generations. Imagine a substantial part of your marketing campaign is being subsidized by the United States Government. Healthy eating and lifestyles may not happen overnight or ever but that won't stop US agencies from pushing healthy eating 


 2) When you look at something like Whole Foods and visit any of their stores. What you see are high prices 15-20% higher than your avg grocery store. The other thing you see is a full parking lot and lines at every register. Meaning that people with the means to do so are willing to pay the higher premium to get organic natural food. These shoppers and the children of these shoppers have made eating healthy a priority and most likely stress such behavior to their children.  


3) Whole Food has the advantage of being first on the playing field and I think they will continue to make strides nationwide however this market isn't cornered by Whole Foods. This is not like a Mac Book Air where you either have a Mac or you don't. You will never see a patent on "Organic Apples" (I hope not at least) which means that capitalism will operate to bring the best product at the best price to those customers looking to purchase it. 


The parents of baby boomers who had 5-6 children had major concerns when it came to quantity over quality in regards to food. Those children have all grown up now and don't face that same dilemma their parents did. They focus on quality more than anything and will continue to do so. 


Take the risk on TFM and just wait 15 years, the return will give you plenty to talk about over a nice organic meal.


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