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With organic food sales growing at the astounding rate of 25 to 30 percent a year and suppliers struggling to meet the demand, Cody may have spotted a lucrative niche. Since Cody together with silent partner, Brent Blundy (the man behind Sanity Music and Bras’n Things), bought the original Macro store in Bondi Junction in 2004, the pair have opened eight stores across New South Wales and Victoria as well as a stand alone café. A report from Inside Business estimated the combined turnover between his Bondi Junction and Crows Next stores alone to be over $20 million a year. Cody is highly ambitious and plans to expand the organic supermarket chain to the other states with the target of owning over 40 Macro stores nationally. In April 2007, Macro Wholefoods was vetted to be one of the ‘Ten to Watch’ retailers by UK-based international food and grocery expert IGD.

Retailing is a relatively new game to Pierce Cody but business is in his blood. Cody comes from a pedigree of entrepreneurs who have had stakes in a range of businesses including a Fijian Gold Mine, a steamship company and the famous Young and Jacksons pub in Melbourne’s CBD. However, Cody opted for a different trajectory and went straight out of university into the advertising industry working with corporate giants such as Clemenger Harvey Edge. During his time working in agencies, he saw that the outdoor industry lacked sophistication and there was an opportunity for him to fill a need in the market. He started Cody Outdoor in 1993 and within three years it became Australia’s largest outdoor advertising company and by 1997 his business was operating in Hong Kong. Within five years of establishing his outdoor media company, he grew the business from $5 million in its first year to between $60 and $70 million dollars.

In 2001 Cody sold his business to APN Outdoor and took the reigns as its Chief Executive, however, going from entrepreneur to executive didn’t quite sit with him. He also had an interest with other investors in establishing the Tower Estate in the Hunter Valley, however, this wasn’t enough to satisfy his hunger either.

The idea for Macro Wholefoods came when Cody was waiting to catch up with a friend in London. The place they were to meet was in a café at Fresh and Wild – a supermarket chain that Cody describes as “Jones the grocer meets organic superstore”. Having arrived an hour too early, he spent a little time people watching, and he observed that the customers seemed engaged, happy and the staff seemed pleased to answer people’s questions about the products on offer.

When he came back to Australia he conducted extensive research and discovered that nobody in Australia was operating a significant organic retail chain. To learn more about the industry, Cody spent a lot of time overseas studying Fresh and Wild in the UK and organics supermarket Wholefoods in the USA to understand how they operated and what they stocked. At about the same time, Macro Wholefoods in Bondi Junction came up on the market.

Cody says that the then Macro Wholefoods was a great little business making a ridiculous amount of money for the size of the store, despite it always being overcrowded and having terrible parking. Cody saw the store’s location and popularity as the ideal business to build a prototype for a multi-store operation.

Cody also put the idea of purchasing the Bondi store, improving it and developing an organic supermarket chain to his friend, Brett Blundy, who owns the successful BNT and Sanity Music chains.

“When I took Brett overseas to show him what these stores were doing he was blown away by what they offered. It was quite funny to see this retailing guru behaving like a kid in a candy store,” he laughs.

Blundy liked the idea and agreed to go into partnership with Cody. In 2004 the pair purchased the store, which had been a thriving business in the area for over 17 years.

“The store was run by two guys who had built up a very profitable business. They had put a lot of work into building up the brand, the store’s philosophy and a very loyal customer base,” Cody says.

“Although the model was great as a single store operation, it was too difficult to spread it over a number of stores because the focus was too narrow. The pair tried a second store but it didn’t work out,” he adds.

To prepare the business for a multi-store roll out, Cody challenged every platform within the store – expanding and diversifying product lines to give it the feel of a supermarket chain. He also implemented new operating systems which were all geared towards multiple stores.

One of the key changes he made to the business was introducing organic chicken and meat to the product lines.

“This alienated some people because Macro was originally a vegetarian organic supermarket and they felt we were going against the ethos of the store by introducing these product lines. However, in the end this was only a handful of people and we felt it was important for the store to appeal to a wider market if it was to be successful,” he recalls.

Later the same year Cody and Blundy opened their second store in Crows Nest and not long after they branched out into Victoria to set up Macro Wholefoods in the Richmond. Over 2006 and 2007 there were a flurry of openings in both states and more stores are in the pipeline.

Establishing a new type of retail store with virtually no experience in retail presented significant challenges for Cody. Cody prefers to deal directly with growers where possible, because he believes that as more organic farms become established and reliable large scale orders increase, the cost of produce will come down. However, many of these growers are small and their systems and logistics are unsophisticated, so as Macro grows they simply don’t have the scale to keep up. Although some growers are expanding and becoming more commercially savvy as Macro proliferates, Cody says that he has to rely on some wholesalers because the logistical exercise of maintaining perishable stock in multiple stores is just too complicated. He says that developing supply chains is so multifaceted and complex that even the most experienced retailer would have found it difficult to master.

Upholding a healthy supply chain may have presented its share of headaches, but Cody’s biggest hurdle has been obtaining the right staff for the business. Cody says that the difference between his store and the Coles and Woollies styled supermarket is that his customers read the labels, question the menus, and ask staff about the products. They’re educated, well read and won’t accept products laden with chemicals, hormones, genetic modification, growth accelerants and they don’t like products that harm people or the environment.

“We are selling the concept of ‘conscious consumerism’ – making informed choices about what you buy. Because our clientele will ask questions about what’s on shelf, we need passionate informed staff rather than the type of personnel required in an off the shelf supermarket.The dilemma we face is that a lot of people who apply for jobs here subscribe to the conscious consumer movement but lack commercial pragmatism,” he says.

“One of the problems we’ve found are people coming to the business starry-eyed thinking Macro Wholefoods would be a great place to work. These people have a passion for conscious consumerism but don’t understand that there is another highly important component to the job – customer service. Our expectations are high and some find that the role is not what they expected. Trying to find and retain staff who have a passion for the industry as well as excellent customer service skills has been one of our greatest challenges.”

Macro Wholefoods is trying to up the ante of service in an industry which has a reputation of being commercially barren. To recruit and train high quality personnel, Cody employed a former staff development manager from McDonalds – a company renowned for its branding and its uncompromising service standards. To ensure that service standards are maintained as the number of stores grows, Macro Wholefoods has developed a comprehensive training and induction program. Cody also says he plans to increase ongoing staff development and training.

To keep improving the business’s standards, Cody also uses an informal customer panel based on his networks of people. He adds that he receives and personally responds to feedback from the public everyday on what the business is doing right and wrong.

“I really pay attention to this feedback because I generally find that the public are very candid about how the business and staff are performing,” he remarks.

To the surprise of many, when you enter a Macro store you immediately notice that the aesthetics of the fruit and vegetables on display are as presentable as any green grocer or supermarket. This is not the stereotypical image of an organics store. Typically, mung beans and half rotten apples are what come to mind for many consumers and Cody is trying to dispel that cliché.

“We could pay less for our fruit and veggies, but I don’t find sub-standard produce acceptable. There is no reasonwhy organic produce has to be aesthetically poor. If we want to grow our brand, we need to uphold our standards,” he reasons.

Cody confesses that it has been tough maintaining these standards. He also admits that the relentlessness ofmanaging a seven day operation with perishable goods and a fragile supply chain have been some of the most difficult aspects of making the transition from ad man to retailer.

“A key difference between the ad industry and retail is retail is faster, more detailed and more dynamic than advertising. In retail, your situation changes in quarter hour blocks and it doesn’t stop. When it’s good, it’s fantastic, but when it’s bad, it’s really bad,” he says.

“In saying that, the fundaments of the two businesses are the same. The key to both of my businesses has been knowing my target and catering to them. The other key similarity has been developing the brand. I believe this is particularly important and this is where I’ve placed a lot of my energy.”

In developing the Macro Wholefoods brand, Cody has primarily focused on a PR drive. Cody spends time working closely with his agency, Map and Page to get the Macro message out to consumers. He says that the emphasis has been on educating the public about conscious consumerism and where Macro fits into the picture. Cody believes the media have been very kind to Macro Wholefoods and the business has received positive coverage in relation to health, food, the environment and business.

He adds that despite the good coverage, the executionmust be right. Not only does Macro Wholefoods invest heavily in its staff and high quality produce, but it also ensures that its visual merchandising is of a high calibre.

By raising the profile and standards of the Australian organics industry, Cody believes he has raised the competition in the industry. Suppliers are evolving and thesupermarket chains are increasing their range of organic products. He says that he doesn’t have a problem with the supermarkets because the larger chains are educating the public by expanding their product range. From his experience, if people want to know more then they come to Macro where they have anywhere between 8000 and 12,000 products to choose from, depending on the store.

Macro’s largest stores in Crows Nest and Richmond boast a floor space of over 1200 square metres and are among the largest organic stores in the southern hemisphere. Macro has also evolved into more than just a supermarket. Most outlets also have an adjoining café and some also offer Pilates and Yoga classes, and the services of a Naturopath.

Another critical arm of the business is the range of products branded under the Macro Wholefoods label, which not only generates an additional revenue stream, but is important to the company’s overall branding strategy.

“We not only have a huge range of organic products, but we also cater to people with special needs such as celiacs, people who are lactose intolerant, pregnant women and people with allergies,” he proclaims.

With so much momentum behind his business, Cody has no plans to slow down and describes his life as being “calculatedly out of control”.

“Anyone who has started out in business knows how tough it is. I try wherever I can to live to the Macro mantra of healthy living and a balanced lifestyle, but we are rapidly expanding and I need to nurture this business which is still experiencing some growing pains,” he reasons.

Cody has been quoted as saying that if he had his way, they would already have 15 stores, but the availability of prime space is hard to find. He eventually plans to take the business offshore to both New Zealand and Asia, however he believes he needs to get his local operations right before he embarks on that venture.

At present, the Australian organics industry only has about 0.3 percent of the Australian food retail market. According to Cody, it is six percent in the US and growing rapidly. He would like to see Australia at five percent. 45 percent of the world’s organically farmed land (12.5 million hectares) is here in Australia, so it appears that supply is not an issue. The question will be whether the demand is there, or, how one goes about creating it. It seems however, Pierce Cody might be well on his way to doing so already. Macro Wholefoods currently has 20,000 people signed up to its loyalty card and now he is planning a chain of Macro Cafes across the country which will outnumber his supermarkets three to one. The public’s awareness of the environment, healthy eating and complementary medicine is growing rapidly. No doubt retailers will be watching Macro Wholefoods very closely to see what the future holds.