Amazon’s unstoppable growth has raised many eyebrows in the United States and the government is not too please with the company hogging major portions of the market, killing off all its competitors. At such a time, news surfaced that the Jeff Bezos-owned company had managed to buy Whole Foods for $13.7 billion. Now, a member of congress is asking fellow lawmakers to look into the deal that has been etched by Amazon and Whole Foods.
Congressman asks lawmakers to review Whole Foods sale to Amazon
Rhode Island Congressman, David Cicilline raised the issue of the Whole Foods' sale in Congress today, claiming that Amazon was responsible for the downfall of the brick-and-mortar stores when it opened its online shop.
The congressman believes that letting Amazon into the grocery business setup by acquiring Whole Foods will lead to the company dominating the food business, which would be unfair in terms of competition.
In a letter to the House Judiciary Committee Chairman, Cicilline demanded an inquiry into the Amazon-Whole Foods deal. He claimed that the acquisition of Whole Foods by Amazon led to questions regarding the competition policies as well as the future of the grocery market in the country. He also revealed that Amazon was likely adding its service to indirectly influence its own popularity. With Whole Foods the company would try to establish dominance over its competitors and in turn promote its own services.
What experts feel?
Wall Street officials claimed that the Congressman may be worrying himself unnecessarily. Although the news of the deal shocked many of the people working in Walmart and Kroger, it is still too early to claim that the presence of Amazon will hamper the market for these two massive supermarket chains. Currently, people associated with Walmart would be perhaps more worried to see what lies in the future for Whole Foods and Amazon.
Walmart said that it controlled 17.3 percent of the grocery market as of 2016, which is huge when compared to the 1.7 percent of the market that Whole Foods satiated in the same year. Amazon on the other controlled just 0.8 percent of the market on its own. These figures are a good indication of how dominant Walmart is and why it will survive the partnership between Amazon and Whole Foods.
Congressman Cicilline did claim that most experts shared the opinion that the $13.7 billion dream venture would not cut off the competition and would likely not violate the anti-trust rules that are in place. However, he said that the deal raised questions regarding Amazon’s dominance in the e-commerce business.
