Whole Foods Bets Big on LA's Mendocino Farms With New Minority Investment

Sandwiches are becoming big business in Southern California, as local chain Mendocino Farms has agreed to give a minority investment stake to organic grocery chain Whole Foods. That news comes courtesy Nation’s Restaurant News, which says in their exclusive that Mendo will use the cash infusion to help speed up their expansion plans to San Diego and beyond.

It’s an equally strong move for Whole Foods, who gets access to one of the more popular local sandwich chains around. Mendocino is not only known for their friendly service and quality offerings; their branding has been pretty solid since day one, and it’s always felt like they had big plans to expand nationally, with or without a ton of capital investment. So Whole Foods now gets to piggyback on that growth, and also has options for merging the two businesses in unique ways.

Case in point: the new Whole Foods 365 casual market concept that the grocery retailer is rolling out this year (the first location should land in Silver Lake sometime in mid-to-late 2016). In order to build quickly and stay ‘hip,’ those 365 markets could (and likely will, according to NRN) choose to partner with local brands like Mendocino Farms for in-store vendor offerings, which would diversify the Whole Foods food court model while defraying some of the build-out costs and leveraging an existing brand to help draw customer and media attention.

It's unclear when exactly the store-inside-a-store model will happen, but don’t be surprised if Silver Lake’s Whole Foods 365 comes with a side of Mendocino Farms attached, making the whole current build-out a big deal for the area.