Whole Foods Market is to close its Champagne and oyster bar at its flagship London store and start selling ready meals after an overhaul of its UK strategy.

The US retailer, which opened its first UK store in 2007, has been forced to re-evaluate its tactics following heavy losses, a former insider told The Grocer. Last year, the large fresh seafood counter was also pulled due to significant wastage, and has been replaced with a smaller one.

Ready meals would be introduced to try and tap the popularity of convenience food, the former Whole Foods Market executive confirmed. "It realised there was a big market for ready meals and looked at what M&S does. It realised people in London want convenience. The store is great for food for dinner parties, but you don't have them every day."

The retailer has struggled to make an impact with its 80,000 sq ft flagship Kensington store, a former department store on a busy high street. Accounts in June show it made a £35.9m loss in the UK last year.

"The major problem is the location and the lack of a car park," said the source. "It didn't consider the problems of an inner city location. Londoners shop as they go home, so while the store is popular at weekends, in the week it's empty."

The changes have been made since former head of Whole Foods for the north Atlantic, Jeff Turnas, was brought in from the US in March to run the UK business. The retailer is also understood to have altered its property strategy since the recession hit and is now focusing on smaller stores with regard to expansion.