Amazon Plots The Future Of Food

The Purchase of Whole Foods Is A Step Towards a Major Presence In Food Retail

Amazon, the biggest online retailer, has so far taken only tentative steps into groceries, the biggest retail market. It has launched AmazonFresh and its Amazon Go no-cashier stores, but it has been held back by the seeming incompatibility of the food business and Amazon’s traditional business model: People often buy small quantities of fresh products frequently, and they like to be able to see – and feel – the fresh products they are buying.

The acquisition of Whole Foods Market in June 2017 will take Amazon’s food presence to another level. Amazon has lacked a great range of food products; Whole Foods is a recognized, trusted brand with a fantastic assortment. Amazon did not have expertise in running a groceries business; the acquisition brings with it an understanding of on-the‑ground food retailing. And by combining sales of food and other items, Amazon will gain scale that reduces the cost of delivery and enables price reductions across the grocery range.

Amazon Plots The Future Of Food