Amazon has taken over Whole Foods Market, agreeing to a massive $13.7 billion deal that could change the way we shop for organic food.
This is Amazon’s biggest acquisition ever, and brings Amazon one step closer to their goal of being an Earth centric company where anybody can find anything they want.
“The overlooked asset Amazon gets in the deal is Whole Foods’ 365 house brand — one of the most coveted in the organic and natural space, private label and otherwise,” Forbes adds. “A Piper Jaffray survey last spring found that 365 is customers’ favorite organic-food brand, ahead of premium names like Kellogg’s-owned Kashi and General Mills’ Annie’s.
The 365 brand is virtually unavailable online, but that will change if Amazon is smart about it. ‘The opportunity to use the 365 brand as a mainstay of their online offering is really profound,’ says Bernstein analyst Alexia Howard. ‘It puts a huge amount of pressure on branded food sales.'”
The Atlantic explains more about why Amazon acquired Whole Foods. First of all, they want to get into the food delivery service industry.
Secondly, they see Whole Foods as an urban distribution hub. “Amazon did not just buy Whole Foods grocery stores. It bought 431 upper-income, prime-location distribution nodes for everything it does,” tweeted Dennis Berman, the Wall Street Journal’s financial editor.
Thirdly, this is also about adding more benefits to the already booming Amazon Prime subscription service, which allows for free two-day shipping, streaming movies, and many other features.
While the move may seem like it will make life more convenient, some health experts are not so sure how the new model of Amazon and Whole Foods together will affect quality.
Dr. Mercola, a leading health expert and physician weighed in: “When a food system becomes highly automated, quality invariably declines. We’ve already seen this with the popularization of organic foods sold through grocery stores. These foods are rarely locally grown. Instead, the majority is imported, and there’s no telling what you’re getting, really.
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REFERENCES:
1. “Amazon Takes Over Whole Foods Market.” Mercola.com. Mercola.com, n.d. Web. 06 July 2017.
2. “Why Amazon Bought Whole Foods.” The Atlantic. Atlantic Media Company, 16 June 2017. Web. 06 July 2017.
3. “Amazon to Buy Whole Foods for $13.4 Billion.” The New York Times. The New York Times, 16 June 2017. Web. 06 July 2017.
