Whole Foods cutting 1,500 jobs

Hadley Malcolm | USA TODAY

Whole Foods (WFM) is cutting 1,500 jobs over the next two months, or about 1.6% of its workforce, as it focuses on its strategy to lower prices for customers, the grocery chain said Monday.

Shares ended down 1.1% for the day.

The cuts come after Whole Foods added more than 9,000 jobs in the past year. The company said it expects "a significant percentage" of employees being let go to find other jobs among Whole Foods' open positions, including those available due to more than 100 new stores that are set to open. Whole Foods has about 91,000 employees and 431 stores across the U.S., U.K., and Canada.

"We believe this is an important step to evolve Whole Foods Market in a rapidly changing marketplace," co-CEO Walter Robb said in a statement. The company also said that the job cuts will let it focus more on upgrading technology.

Whole Foods would not say which specific positions will be cut.

Whole Foods is up against increasing competition in the organic grocery space it once dominated as more mainstream and affordable grocery chains have started selling organic brands. Its reputation has also taken several hits in recent months.

Executives apologized to customers in July for pricing discrepancies that may have been found in the chain's New York City-area stores. Robb and co-CEO John Mackey admitted to making "some mistakes" after a local investigation alleged Whole Foods was systematically overcharging for certain pre-packaged goods. The two deny that accusation though and said that any mislabeling was "unintentional."

The company's stock plunged more than 10% when it missed earnings expectations for the third quarter and reported sales at stores open at least a year had fallen compared to a year ago.

And in August, Whole Foods found itself the target of social media jokes and frustration over the chain's high-end groceries when a photo of a product called "asparagus water" went viral. Turns out the product was a mistake.

Whole Foods has been trying to tone down its reputation for selling expensive food. The company plans to start opening an off-price chain called "365" next year, aimed at younger shoppers and with a focus on cheaper groceries. So far five locations have been announced.