Saturday, June 17, 2017

Amazon and Whole Foods

Everything that can be written and said about this acquisition is probably already out there in the media and blogging world.  Two cents here...  it IS a big deal, but it should not substantially affect Walmart and Costco.  Why?

Walmart is by now a global company that is growing.  When a friend is vacationing in Mexico and mentions walking to Walmart to shop that is not trivial.  Walmart's distribution system is more extensive than Amazon and more local.  Costco is a unique experience, a place that is known for unpredictability as well as value.  The stores are destinations, not routine grocery outlets.

Target is more in danger from the combination as their stores have lost their once unique cachet, no matter how hard they have tried to recapture it.  The various "dollar stores" could be at some risk as well.  With all of the talk and reality in the market of retail contraction already,  this transaction was timed to get attention.  It did.

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