On Friday, June 16, 2017, online retailer Amazon announced its plans to purchase Whole Foods. The company is known for its organic produce and other health products.
Amazon strikes a deal
In an attempt to further pressure one of its biggest competitors, Walmart, Amazon decided it was time to jump into the grocery scene with its purchase of Whole Foods Market, an upscale Grocery Chain known for its organic products and health foods. With a $13.4 billion purchase, Amazon is stepping up its game and hoping to get an even stronger foothold in the retail market.
Groceries account for a large amount of Americans spending money, and it is an $800 billion market in the United States.
Whole Foods looks for a pick-me-up
Whole Foods is a favorite by health nuts and the average shopper alike. Although frequently criticized for its high prices, Whole Foods has found its home in the food industry and continues to be the grocery store of choice for many consumers. As more and more grocery stores have begun offering organic produce, Whole Foods is no longer people's only option.
Almost every grocery store has an organic section or the option to swap out conventionally grown fruits and vegetables for their organic counterparts. With Whole Foods no longer the only name in the game, people are starting to choose the lower prices at the local grocery store over shopping in Whole Foods.
With consumers going elsewhere, Whole Foods has been forced to cut prices and has been undergoing other major changes, with the Amazon purchase being the most recent.
A new partnership
Amazon has long been looking to offer physical stores for their customers to shop at. They started with a small chain of bookstores and had even moved into a cashier free convenience store, Amazon Go.
With Whole Foods as a new project, Amazon will be able to have even more physical locations than ever before. This could be a very important part of their future profits.
There has already been some speculation in what Amazon's aptitude for technology could mean for the Whole Foods shopping experience. Known for drones that bring packages to your front door and convenience stores that can keep track of what products you put in your basket, it is logical to wonder what this might mean for the grocery chain. However, Amazon has announced that it does not plan to use the same systems as Amazon Go, meaning that people's shopping experience will mostly remain unchanged.
