Richmond Grocery Wars Update: What Will Amazon Do Next?

Posted on in Commercial Real Estate, RVA Grocery and Delivery Wars

At the end of last week, Amazon announced its plans to acquire Whole Foods for $13.7 billion dollars. This is an aggressive and strategic move on Amazon's part as it fights to dethrone Walmart as the current retail giant.

As reported in the Richmond Times Dispatch over the weekend, analysts are predicting that this acquisition will be a game changer for both retail and grocery markets, as Amazon could use Whole Food's 460 stores in the U.S., Canada, and Great Britain as distribution hubs for more than just groceries. Amazon's "missing element" in the delivery of products to consumers has been groceries, as the e-commerce fulfillment centers are simply not set up for storing and handling perishables, such as meats and produce.

Amazon's goal appears to be to make the company the "one stop shop for everything" by blending online shopping with off-line shopping, thereby removing the need for consumers to go to other retailers, including grocery stores. The acquisition of Whole Foods, which is expected to close by the end of 2017, moves Amazon significantly closer to attaining that goal.

Walmart, which currently has the largest market share of grocery sales in the U.S., as well as Kroger, Target, and big box clubs such as Costco, will have to react and pivot as Amazon once again changes the face of retail and grocery sales. Amazon's innovations will not likely stop with this move.

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