There are deals, and then there are big deals. Amazon buying Austin-based grocery chain Whole Foods for $13.7 billion certainly falls into the latter category. But what makes this deal so big isn鈥檛 even the money 鈥� there have been bigger deals before 鈥� it鈥檚 the ripple effects on workers, wages, other companies and everyday people.
Since the deal was announced early Friday, some of its long-term effects are starting to become more clear.鈥淎mazon has had grocery ambitions for a long time,鈥� says . 鈥淭hey spent about a decade trying to crack the code on fresh food. This would give them a very premium brand that has a lot of credibility with customers, and puts them right in the middle of the grocery industry in one fell swoop.鈥�
Giammona says there is some concern among 鈥渉ard-core Whole Foods fans鈥� that Amazon could change the grocery鈥檚 image and product options.
鈥淎mazon competes head to head with Walmart, so that鈥檚 a very different world than organic food or quinoa and kale and the premium food that Whole Foods is known for,鈥� he says.
But he also says the deal could be an opportunity for Amazon to fix some of the issues Whole Foods has faced, as well as an opportunity to .
鈥淕rocery has been pretty insulated from e-commerce to this point,鈥� Giammona says. 鈥淭here was a sense that that was changing, and now [Amazon] is right in the middle of the industry if this deal goes through.鈥�
He says other grocers like Kroger, Costco and Walmart are in the process of figuring out what鈥檚 next and how they鈥檒l respond to remain competitive.
He says it鈥檚 also too early to know what exactly Amazon will do with the more than 400 brick-and-mortar Whole Foods stores they鈥檒l acquire.
鈥淎re they going to put lockers in there where you can pick up electronics and clothes? It is really fascinating to think how the landscape could change if this deal goes through,鈥� Giammona says.
Written by Molly Smith.
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