(Aug. 6, 10:35 a.m.) Whole Foods has scaled back on its aggressive growth and supersized stores.

During the Austin, Texas-based retailer’s third quarter conference call Aug. 5, chief executive officer John Mackey said the company has downsized the lease sizes and number of stores planned for the next year.

“We are lowering our expected new store openings in fiscal year 2009 to 15 from our prior range of 25 to 30,” Mackey said. “While we were ready to execute on the acceleration in our store openings, we now wish to take a more conservative approach to our growth and business strategy over the short term.”

The company also has downsized leases by an average of 9,000 square feet each. Mackey said the company has determined that its ideal store size in the next couple of years isn’t 80,000 square feet, the size of its Austin flagship.

“We are focused on the right store size for each market,” Mackey said. “We see that really large stores are very powerful in limited markets and circumstances, and that smaller stores can also produce great returns for us.”

Mackey said that stores ranging from 35,000 to 50,000 are more appropriate for most circumstances.

In the third quarter, Whole Foods sales grew 22%, but Mackey said he sees tough times in the coming months.

“Today’s economic environment, however, is the most challenging I have experienced in my 30 years in retail,” he said. “Consumer confidence for June hit its lowest level in more than a decade.”

One challenge the retailer faces comes from a continued battle with the Federal Trade Commission over its purchase of Boulder, Colo.-based rival Wild Oats Market Inc. An appeals court overturned the decision to allow the merger in late July.

Mackey briefly addressed the issue during the conference call’s question-and-answer session, saying he’s not sure what Whole Foods’ next move will be or what kind of remediation could result from the challenge.

“You got me, man,” he said. “I’m scratching my head here. The merger is completed. We paid the shareholders and sold off Henry’s and Sun Harvest.”

Whole Foods also has rebranded two-thirds of the remaining Wild Oats stores and implemented Whole Foods systems, he said.

“We’ve lowered prices across the board to Wild Oats stores, improved quality, increased sales,” he said. “We’re trying to figure it out and we don’t know what our next move is going to be.”

Whole Foods tempers its expansion plans
Whole Foods, which is pulling back a bit on its previous expansion plan, still faces a battle with the Federal Trade Commission over its purchase of Boulder, Colo.-based rival Wild Oats Market Inc.