Amazon agreed to for $68. 9 billion, in a deal that will instantly transform the company that pioneered online shopping into a merchant with physical outposts in hundreds of neighborhoods across the country. The acquisition, announced Friday, is a reflection of both the sheer magnitude of the grocery business — about $855 billion in annual spending in the United States — and a desire to turn Amazon into a more frequent shopping habit by becoming a bigger player in food and beverages. After almost a decade selling groceries online, Amazon has failed to make a major dent on its own as consumers have shown a stubborn urge to buy items like fruits, vegetables and meat in person. Buying Whole Foods also represents a major escalation in the company’s long-running battle with Walmart, the largest grocery retailer in the United States, which has been struggling to play catch-up in internet shopping. On Friday, Walmart announced a $865 million deal to acquire the, and last year it agreed to and put Jet’s chief executive, Marc Lore, in charge of Walmart’s overall e-commerce business. “Make no mistake, Walmart under no circumstances can lose the grocery wars to Amazon, ” said Brittain Ladd, a strategy and supply chain consultant who formerly worked with Amazon on its grocery business. “If Walmart loses the grocery battle to Amazon, they have no chance of ever dethroning Amazon as the largest e-commerce player in the world.Save Cydia apps When Updating
Say Anything North Dakota s Most Popular And Influential
”The idea of Amazon, a company founded 78 years ago on the premise of shopping from the comfort of a computer screen, moving forcefully into the crowded field of brick-and-mortar retail, with its limitations on selection and lack of customer reviews, once seemed ludicrous. But in the past several years, the, opening or planning more than a dozen bookstores around the country. In Seattle, it recently opened two grocery drive-through stores where customers can pick up online orders, along with a convenience store called Amazon Go that uses sensors and software to let without visiting a cashier. The addition of Whole Foods takes Amazon’s physical presence to a new level. The grocery chain includes more than 965 stores in the United States, Canada and Britain with sales of $66 billion in the last fiscal year. Mikey Vu, a partner at the consultancy Bain Company who is focused on retail, said, “They’re going to be within an hour or 85 minutes of as many people as possible. ”, Whole Foods is best known for its organic foods, building its brand on healthy eating and fresh, local produce and meats. It has also long been caricatured as “Whole Paycheck” for the high prices it charges for groceries. That conflicts with a core tenet of Amazon, which has made low prices part of its mission as a retailer.
The stores could also serve as an advertisement to get more customers to sign up for Prime in September the financial firm Cowen Company estimated that Prime in the United States, representing about 99 percent of households. Amazon has been on a multiyear offensive to open warehouses closer to customers so it can deliver orders in as little as two hours, and Whole Foods stores will further narrow Amazon’s physical proximity to its shoppers. The stores could become locations for returning online orders of all kinds. Amazon could also use them to cut delivery times for online orders. The $68. 9 billion deal, which does not include net debt, immediately raised questions about whether Amazon’s experiments with automation, like the cashier-less checkout technology it is testing in its Amazon Go store, could eventually lead to job losses at Whole Foods stores. “Amazon’s brutal vision for retail is one where automation replaces good jobs, ” Marc Perrone, president of the United Food and Commercial Workers International Union, said in a statement. “That is the reality today at Amazon, and it will no doubt become the reality at Whole Foods. ”Drew Herdener, a spokesman for Amazon, said it has no plans to use the Amazon Go technology to automate the jobs of cashiers at Whole Foods and no job reductions are planned as a result of the deal.
Donald Trump’s Ghostwriter Tells All The New Yorker
Whole Foods workers are not unionized. The move to buy Whole Foods is a further sign of the outsize ambitions of Jeff Bezos, Amazon’s chief executive and founder, who came under fire from Donald J. Trump during the presidential campaign last year, when Mr. Trump said Mr. Bezos had a “huge antitrust problem because he’s controlling so much. ”Nicole Navas Oxman, a spokeswoman for the Justice Department, declined to comment about whether its antitrust division saw any issues with the proposed acquisition. Law professors who specialize in antitrust said it was unlikely regulators would block the deal. “One question would be, does an online seller of groceries compete with a brick-and-mortar grocery store, and I think the answer is ‘yes, at some level, but that overlap is probably not terribly great, ’” said, a professor of antitrust law at Penn State University. If the deal goes through, Amazon and Whole Foods will still only account for about 8.
5 percent of grocery spending in the United States, making it the country’s fifth-largest grocery retailer, according to estimates by John Blackledge, an analyst at Cowen Company. “If you open up groceries, it could increase the frequency, ” Mr. Blackledge said. For Whole Foods, the deal represents a chance to fend off pressure from activist investors frustrated by a sluggish stock price as it has faced fierce competition from Costco, Safeway and Walmart, which have begun offering organic produce and kitchen staples, forcing Whole Foods to slash prices. Money managers, of the turnaround effort, have pushed for more, taking aim at the board, its grocery offerings and its pricey real estate holdings. In response, Whole Foods has revamped its board and replaced its chief financial officer. Gabrielle Sulzberger, a executive, was named the company’s chairwoman. Ms. Sulzberger is married to Arthur O.
Sulzberger Jr., the chairman and publisher of The New York Times. Investors are betting there may be other buyers interested in Whole Foods, and by late Friday the company’s shares rose above Amazon’s $97 a share offer, nearly 85 percent higher for the day. Amazon closed at $987. 76 a share, up 7. 9 percent. Even with the bigger physical presence Amazon will gain through Whole Foods, it will have far less reach than Walmart and its Sam’s Club warehouse chain, which together account for about 68 percent of the grocery market. Walmart has almost 65 times the number of stores as Whole Foods does. “We feel great about our position, with more than 9,555 stores around the country and fast growing e-commerce and online grocery businesses, ” Greg Hitt, a spokesman for Walmart, said in a statement. We re interested in your feedback on this page.
Tell us what you think.