One of the emerging small chains in western United States is Sunflower Farmers Market. This organic food grocer is a lower-cost health-food/grocery-store combination focused on fresh produce and natural meats and poultry. They are generally lower priced than mainstream health-food stores such as Whole Foods and have benefited from consumer trends toward more healthful foods and lower prices. Their strategy is simple. They buy produce directly from growers and use a network of 50 to 70 private-label manufacturers to keep prices down. So, they are striving to serve the middle market of people that want health food but can not afford it.
CEO Mike Gilliland mentioned that in the start-up process, they would look at their competitors and model their behavior and then fill in the gaps. He goes onto mention that there is a desire for healthy food and that they are at a nexus of trends. As a result, Sunflower Farmers Market has capitalized on this trend, and in 2009 they saw sales grow by 50 percent from the year before, to about $300 million. According to the Nielsen Co., Sunflower's three Valley stores have 0.31 percent of the Phoenix-area grocery market. That compares with Trader Joe's at 1.96 percent, Sprouts at 1.61 percent and Whole Foods at 1.11 percent.

From a strategist viewpoint, it is easy to see that there were little barriers of entry in this market. Sunflower Farmers Market was able to enter into the market and after a few years, have 50% growth and a segmented portion of the retail grocery industry. They were also able break through the supplier power barrier by purchasing their products straight from the producers and using a network of private-label manufacturers. As a result, this small chain has continued to grow over the last few years with a bright forecast for the future.