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Amazon has announced that it will reduce the prices of hundreds of items sold at Whole Foods as of Wednesday, which goes against the image of the channel. grocery store where buyers demand that their "whole Paycheck" shop in their establishments.
The decision to cut prices comes against a backdrop of heightened competition in the grocery industry, particularly because of Walmart's desire to expand into the retail food category, said Charlie O & Shea, Moody's analyst. Amazon, which had bought Whole Foods for nearly $ 14 billion in 2017, had already increased its prices earlier this year due to inflation.
Amazon said the price cuts would be product-focused, and that it planned to double the number of contracts with core members to 300 per store. At the same time, the company said that its products sometimes cost more than at other retailers because its standards prohibited the sale of foods containing high fructose corn syrup, artificial ingredients and some preservatives. It remains to be seen whether lower prices will be sufficient to attract price-sensitive buyers.
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"Amazon's plans to reduce the prices of hundreds of products at Whole Foods, while offering extended benefits to its premium members, recognize the busy landscape of competition in the food retailing sector." Driven by Walmart's relentless effort to continue to grow its position, "Moody's O. Shea said.
The battle between Amazon and Walmart is likely to increase pressure on other grocers, he predicted.
"While Walmart has the means and the willpower to deal with the Amazon threat in the food sector, as well as a different demographic, other retailers in the food and beverage industry, The power supply will continue to be under pressure from the ongoing battle and escalating between Amazon and Walmart, which continues to affect almost all categories of retailers, "said O. Shea.
Amazon said the lowest prices would be big yellow mangoes sold for $ 1 each and mixed cherry tomatoes sold at $ 3.49 for 12 ounces. Lead Member Agreements will include $ 2 off organic asparagus at $ 2.99 per pound after the price cut, and $ 2.99 per pound organic strawberry, $ 2 off the regular price .
Some Whole Foods workers will work all night on Tuesday and early Wednesday morning to switch to reflect lower prices, the Wall Street Journal reported.
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