'I ultimately am not afraid to get fired': Whole Foods CEO John Mackey describes clashes with Amazon in leaked audio from an internal meeting

Reuters/Lucy Nicholson

Whole Foods CEO John Mackey says the grocery chain's sales are growing again.

• Whole Foods CEO John Mackey says the grocery chain's same-store sales are growing again under Amazon, but that the two companies have had "many, many" clashes where he has had to "speak truth to power" and Amazon has "backed off."
• Mackey made the remarks Tuesday during an internal company-wide meeting, according to audio of the meeting obtained by Business Insider.
• "I ultimately am not afraid to get fired ... so that gives me a position of strength to speak truth to power when it's necessary to do so, and I've done it many, many times," Mackey said.
• Mackey also slammed media reports, saying "they just make things up."

Whole Foods CEO John Mackey said Tuesday that the company's same-store sales are growing again under Amazon, which purchased the grocery chain 10 months ago in a $13.7 billion deal.

"It's been an incredible year," Mackey said Tuesday during a town-hall style company-wide meeting, according to audio of the meeting obtained by Business Insider. "Our increase in sales has been far greater than I anticipated and it's continuing."

But the relationship with Amazon has also come with many challenges, he said.

"I'm sure that Amazon has probably gotten more disagreement from me than any other single person, and possibly more than everyone else combined," Mackey said. "I have the least amount to lose: I have done this for 40 years, I am financially secure, I love Whole Foods."

"I ultimately am not afraid to get fired so - not that I think they are going to fire me - but I'm not afraid of it, so that gives me a position of strength to speak truth to power when it's necessary to do so, and I've done it many, many times," he said. "And that's been a good thing because Amazon has listened and they have been very respectful and they have backed off."

Mackey didn't go into detail about the nature of the companies' disagreements.

In response to an employee question about what could change about Whole Foods' culture going forward, Mackey said the company's principles and values would remain the same, but "pretty much everything else we can change."

"This is the thing people are most afraid of, it's like, they love Whole Foods so they don't want it to change," he said.

But in a merger, like in a good marriage, both parties will change over time, he said.

"I would say that those of you that are going to be married - and happily married - are going to change," he said. "You may not intend to, but I promise you, if you don't change you will not stay married. It just comes with the territory - particularly if you are a man you will not stay married."

Mackey slams media reports, saying 'they just make things up'

Mackey said that overall, Whole Foods has made "really good progress" under Amazon.

"I'm overall pleased with where we're at," he said. "Does that mean I love absolutely everything about Amazon? No. I don't. I don't love absolutely everything about my wife either, but on balance, I love like 98%. That's a pretty good ratio based on my previous relationships."

Whole Foods doesn't publicly report sales figures now that it's owned by Amazon. When the companies announced the planned merger one year ago, Whole Foods' quarterly same-store sales had dropped nearly 3%.

Mackey didn't reveal any specific numbers related to sales growth during the meeting, other than saying that the growth is higher than what the media has reported.

"It's much better than the media reports because they don't have any data so they just make things up," he said. It's unclear what reports he was referencing.

Whole Foods plans to cut prices even further

Mackey said the biggest drivers behind Whole Foods' same-store sales growth has been the free delivery of Whole Foods groceries through Amazon Prime Now, which is now available in about half of Whole Foods stores, and the grocer's new discounts for Prime members.

The company has also been working with Amazon to improve profit margins by minimizing out-of-stocks and leveraging its scale to get lower prices from existing suppliers, other Whole Foods executives said during the meeting.

"Prime affinity and Prime Now are the two biggest initiatives, but also reducing our prices - we are going to be doing more of that over time," Mackey said. "Getting things to our customers at lower prices while hopefully not reducing our quality standards and our service has been a major goal in the first year."