News that Amazon bought the high-end grocery store chain for a reported $13.7 billion on Friday left some Americans stunned over the big purchase and others musing about where the largest USA online retailer may be headed next. That comes out to about $42 a share. "Whole Foods Market has been satisfying, delighting and nourishing customers for almost four decades - they're doing an incredible job and we want that to continue", said Bezos.
Whole Foods' stock soared 29 percent.
John Mackey, Whole Foods co-founder, and CEO reveals how this partnership will change the grocery retail chain.
Canadians have few options for grocery delivery with a small number of companies like Grocery Gateway and a few large chains offering the service in limited locations. It had previously announced plans to open a 1,800-square-foot store called Amazon Go in Seattle, Washington. But if customers know that what they are getting is the same as what they'd get at the local store, they are more likely to try it out. Last month, the company named a new chief financial officer and new board members.
Additionally, Amazon has experimented with lockers for picking up orders. The proposed Amazon-Whole Foods deal only further curtails consumer choices and raise prices. Considering the present state of Whole Foods Market, it is an excellent deal. The company has been taking major footsteps towards bigger things.
"No one thought about Amazon", said Phil Lempert, a food industry analyst for SupermarketGuru. "And this is actually brilliant". Amazon also has warehouses in Doral and near Miami International Airport.
"But there will probably be some combination of workers that are right now performing duplicate tasks in terms of the back office or in terms of the corporate headquarters", he said. Discount retailers Target and Wal-Mart fell 8.06 percent and 5.13 percent, respectively. You're going to see a lot of people really trying to figure out what they can do.
He says Canadian grocers could drop prices, improve technology or beef up e-commerce to keep pace.
Whole Foods, founded in 1978, saw its stock peak in 2013 at $65.24. This deal allows Amazon to enter the enormous grocery industry that accounts for $700-$800 billion annual US sales. The folks at Amazon are long-term thinkers.
Whole Foods, for its part, has been around for almost 40 years ― it was founded in 1978 ― and despite criticism over its high price tags, it remains a strong brand name, and one which you could easily imagine Bezos and Amazon doing a lot with.
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