Amazon Whole Foods Case Study

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How Amazon’s Billion-Dollar Buyout of Whole Foods Impacts the F&B Industry Amazon is pushing further into the grocery realm. This, after it made an announcement last Friday to buy the American organic grocery chain, Whole Foods (WFM), for $13.7 billion. The deal is an “all-cash” buyout, making it the biggest transaction ever for the now Seattle-headquartered Amazon. The move simply shows the growing interest of the online retail darling in the grocery industry. As Paul Cuatrecasas, the chief executive of Aquaa Partners, an investment banking firm based in London, said: “This deal should leave no doubt that Amazon is deadly serious about dominating all aspects of retail. Amazon is effectively saying that if retailers are going to…show more content…
The supermarket chain has been offering organic and healthy food since its beginning in 1980 and has been moving in different cities to reach more shoppers. Sadly though, its high-priced grocery items have been its biggest problem ever since. And it’s really exciting to see if bargain retailer Amazon can do something about this. However, although this Whole Foods slash Amazon combo seemed like the greatest deal ever, some analysts are shaking their heads and being skeptical about it. One of them is Synovus Trust’s senior portfolio manager, Daniel Morgan. In a statement, he noted: “To combine a company that specializes in high-end produce and specialty meats with a low-priced provider of everything — well, it’s a complete contradiction. If Amazon is going to buy something, why not a margin-booster like another cloud business that will actually bring profits?” A technology analyst at Edward Jones, Josh Olson, shared his thoughts, too, saying: “Food is the one thing Amazon hasn’t been able to figure out. They’ve tried out all these different concepts, and the question was always: Would going all-in mean getting into the bricks-and-mortar

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