Amazon's purchase of Whole Foods 'bought a distribution network,' expert says
- Author: Zachary Reyes Jun 19, 2017,
Jun 19, 2017, 13:56
Such a fate would be both a symbolic and material blow for Instacart since Whole Foods was its first national grocery partner in 2014. Blue Apron and many of these other meal-kit providers are well-resourced for storing and selling fresh food, and they are already in good metropolitan areas to begin with.
The deal has the possibility to be "transformative", Moody's lead retail analyst Charlie O'Shea said in a note, "not just for food retail, but for retail in general".
The grocery chain, known for its organic options, had been facing increased pressure from rivals, including European grocery chain Lidl, which is planning to enter the East Coast market, along with Aldi and Trader Joe's. "Barclays put an upside value on Whole Foods of $57, which has probably encouraged investors to bet on at least one more raise of the paddle".
They have indicated that they do not plan to automate cashier jobs in the stores, .
Mackey will stay as Whole Foods CEO, and the headquarters will stay in Austin, Texas.
"This will definitely make the market more competitive", she added.
In the USA "this adds 440 refrigerated warehouses within 10 miles of probably 80% of the population", said Michael Pachter, an analyst for Wedbush Securities. In some cases, local governments have blocked Wal-Mart's plans to build stores.
Peggy Hall, a Unionville resident shopping Friday at a Whole Foods supermarket in West Hartford Center, said she would probably not buy food online.
Whole Foods has 9 United Kingdom branches and almost 350 in the USA and Canada.
Amazon launched Amazon Fresh in 2007, a service that for a fee delivers groceries to customers' homes but that has failed to make a wide impact.
Instinet analyst Anthony DiClemente said in a note quoted by CNBC that Amazon is going to disrupt grocery business.
Whole Foods customer Bethany Capels, 34, of Mendenhall, Miss., loads her Whole Foods Market purchases in her auto in Jackson, Miss., Friday, June 16, 2017. And it should be able to bring cost-cutting technologies, such as robots to move inventory around, while the company gets a better picture of customers by marrying data from Amazon and Whole Foods' loyalty programs. Shoppers skip the checkout line, and their Amazon accounts get automatically charged.
Whole Foods, founded in 1978, saw its stock peak in 2013 at $65.24. The stock is up more than 31% so far this year.
A Whole Food Market is shown in Indianapolis, Friday, June 16, 2017. Whole Foods was, however, costlier in 1992 as compared to today (keep the times in check) and it has been reducing the prices to keep the sales in check.
The announcement had immediate and punishing consequences on Wall Street for retailers, such as Wal-Mart Stores, that sell groceries and are expected to face even tougher competition with Amazon now much more active in the space.