Amazon just bought Whole Foods - and Walmart, Target, and Kroger should be terrified
AP
Shares of Kroger, Target, Costco, and Walmart all plummeted after the news was announced, with Kroger's shares hitting a three-year low.
These companies have made major investments in online grocery in recent years, debuting services like click-and-collect and online delivery.
Amazon has begun testing some brick-and-mortar locations of its own, including Amazon Fresh grocery stores. With the acquisition of Whole Foods, the e-commerce giant now controls both an established brick-and-mortar grocery system and the infrastructure to build to successfully execute online sales - an area where most grocery chains are lagging behind.
Up to this point, one of traditional retailers' biggest advantages over Amazon have been their established base of brick-and-mortar stores.
"By giving customers the flexibility to choose when, where, and how to shop, Walmart is able to better serve customers in a way pure online players cannot," Jefferies wrote in a note to investors, summarizing the company's president and CEO David Cheesewright's argument at a recent event. "Food and consumables are great traffic drivers and Walmart's vast distribution and store network gives it a leg up in serving the customer."
With more than 460 stores in the United States, Canada, and the United Kingdom, Whole Foods is not nearly as large as Walmart's 4,692 locations. However, most of Whole Foods stores are in major US cities, providing crucial brick-and-mortar grocery centers for Amazon in these key markets.
NOW WATCH: 9 items you shouldn't buy at Costco
- 2 states where home prices are falling because there are too many houses and not enough buyers
- US buys 81 Soviet-era combat aircraft from Russia's ally costing on average less than $20,000 each, report says
- A couple accidentally shipped their cat in an Amazon return package. It arrived safely 6 days later, hundreds of miles away.
- 9 health benefits of drinking sugarcane juice in summer
- 10 benefits of incorporating almond oil into your daily diet
- From heart health to detoxification: 10 reasons to eat beetroot
- Why did a NASA spacecraft suddenly start talking gibberish after more than 45 years of operation? What fixed it?
- ICICI Bank shares climb nearly 5% after Q4 earnings; mcap soars by ₹36,555.4 crore
- Nothing Phone (2a) blue edition launched
- JNK India IPO allotment date
- JioCinema New Plans
- Realme Narzo 70 Launched
- Apple Let Loose event
- Elon Musk Apology
- RIL cash flows
- Charlie Munger
- Feedbank IPO allotment
- Tata IPO allotment
- Most generous retirement plans
- Broadcom lays off
- Cibil Score vs Cibil Report
- Birla and Bajaj in top Richest
- Nestle Sept 2023 report
- India Equity Market