Online retail giant Amazon announced Friday that it is buying Whole Foods Market for $13.7 billion. The stunning move is likely to have shoppers and workers everywhere wondering how it might impact them.
Although it’s impossible to say for sure, here are three guesses:
1. Whole Foods prices might drop
The bottom line on this deal is that it might help your bottom line — in the form of lower consumer prices. “This will be a good deal for consumers,” says Mark Hamrick, senior economic analyst at Bankrate.com.
Amazon has a history of delivering many different types of goods to consumers at prices that are extremely competitive. According to Hamrick:
“Amazon can be expected to work to deliver better value to grocery customers, both online and within the brick-and-mortar space.”
2. Amazon Prime customers might get special deals
Amazon Prime has been a huge success for Amazon. In fact, as we note in the video below, nearly half of America’s households are Amazon Prime members.
So, it’s not too difficult to imagine Amazon creating unique Whole Foods offers for those who subscribe to Prime. As Forbes contributor Neil Stern writes:
There has to be significant overlap between the Amazon Prime customer and the Whole Foods core consumer. There should be synergies to mine as the two companies collaborate.
3. The future might be darker if you work in the grocery business
At one time, bookstores dotted the nation’s landscape — from Barnes & Noble and Borders to independent shops.
Today, those stores have virtually disappeared, largely thanks to Amazon’s success in selling books online.
CNBC executive editor Jay Yarrow notes that nearly every grocer’s stock price plunged Friday in the wake of the Amazon-Whole Foods announcement. He wonders if the bookstore scenario is about to repeat itself in the grocery business:
Amazon is a fierce competitor. If you work in the grocery business, you’re looking at what happened to bookstores, you’re looking at what’s happening to the retail industry, and you’re thinking, “Uh oh, I’m next.”
What do you think of the huge announcement? Sound off by commenting below or on our Facebook page.
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