26 June, 2017
Amazon is already nearly dominating retail - the company's market share of the us retail sector previous year was estimated at 34 percent, while Walmart came second with 5 percent, according to Needham & Company's research in April.
The deal had a dipping effect at the shares of other supermarkets, food producers, payment processors and shopping malls collectively of around $35 billion in U.S. market value on Friday as they received the news of the deal.
That was feeling of Taylor Malooly, 19, a University of Texas student at Whole Foods in Austin, who said a Whole Foods delivery service would have to be fast if he were to try it.
"It's amusing. I was just ordering something on Amazon", said Nick Yezierski, a hotel manager who was eating breakfast outside the Whole Foods flagship store in Austin, Texas.
Amazon already offers grocery-delivery services in some cities but customers seem excited at the prospect that the Whole Foods deal will make food at your doorstep even easier.
Cowen analysts said that the grocery industry can be broken into three categories - perishable food, non-perishables and consumer products - and Amazon has its hands in all three of those areas, reports CNBC.
Armed with giant warehouses, shopper data, the latest technology and almost endless funds - and now with Whole Foods' hundreds of physical stores - Amazon is set to reshape a US$800 billion grocery market that is already changing rapidly.
The acquisition is an enormous signal that Amazon is dead serious about the grocery business, so Instacart will continue to position itself as a grocer's No. 1 ally.
Whole Foods Market is renowned for offering the best organic and natural foods in the world-and merging its business with another world-known ecommerce giant only means more good news for consumers.
That development challenges big-box retailers Wal-Mart Stores Inc. - the nation's biggest grocer - and Target Corp., whose food business has floundered of late.
He said that even if Amazon gets 20 million members of its Prime loyalty program to pay $15 a month extra for AmazonFresh grocery-delivery service, that's 20 million not going to traditional supermarkets.
"Amazon is an innovative company and we are excited about our partnership".
The merger of Whole Foods and Amazon is expected to close later in 2017 after gaining approval from USA regulators and Whole Foods' stockholders. Walmart, which has the largest share of the US food market, has been working on lowering prices, while Target has been struggling to turn around its grocery business. Its curbside pickup of online grocery orders is now in more than 600 of its 4,700 USA stores. "A lot of people will love that", said Whole Foods customer Brad Anderson.
Amazon stocks rose 2.4 percent to close at $987.71. The stock is up more than 31% so far this year. Year-to-date, the stock is up almost 39%.
