25 June, 2017
"Even if they did compete. you'd have to look at the presence of (other grocery chains)", said Abbott, who argued that many Whole Foods stores are in close proximity to other grocery stores, which means antitrust enforcers might be satisfied there was adequate competition. But the internet retailer isn't "stupid enough" to change Whole Foods' brand, Mackey told employees at Friday's gathering. She also praised the way Shipt allows customers to schedule delivery times to make sure they'll be home when groceries arrive. But Mackey promised a big shift in focus. "If there ever was a time crunch, I'd consider it", he said.
It's not yet clear what specific changes are in store at either Amazon or Whole Foods, since the two companies are saying little about their plans. Mackey had slammed the hedge-fund investors in an interview with Texas Monthly, calling them "greedy bastards" who were only interested in making a quick buck on the sale of the company. "I said, 'I know".
What exactly might these innovations be?
Morgan Stanley analysts have also written in a report that Amazon's acquisition of Whole Foods "creates an entry point to drug delivery" and provides the necessary real estate. That's because while online grocery sales are rapidly growing, according to the Food Marketing Institute and Nielsen, they're still only going to account for 20% of the market by 2025. It's gonna be an unbelievable team for our team member base.
"There are no guarantees in life", Mackey said in response to a final question from an audience member to wrap the meeting.
"Amazon is known to scale experiments very quickly".
Experts note that most Whole Foods shoppers are already familiar with Amazon and are lining up for what could be a smooth transition.
In the USA "this adds 440 refrigerated warehouses within 10 miles of probably 80 percent of the population", said Michael Pachter, an analyst for Wedbush Securities. The deal came together so rapidly - the companies signed a confidentiality agreement April 27 - that Amazon's strategy for the acquisition is still largely in the air, according to people familiar with the matter. "But they're just not gonna be, I don't think, forced on us by Amazon". Whole Foods will be a lab of sorts for Amazon.
Whole Foods also might draw a rival offer from one or more large private-equity firms because "there's a tidal wave of money that's sloshing around" in that industry, said Eric Schiffer, chief executive of the Patriarch Organization, a private-equity firm that isn't involved with Whole Foods. "The company didn't say which banner, Whole Foods Market or 365 by Whole Foods, would lead that growth", Michelle Grant, head of retailing at Euromonitor, wrote to Retail Dive in an email.
