After years of disrupting the retail sector and driving many brick and mortar retailers in bankruptcy, e-commerce giant Amazon.com (AMZN) is now making a bold move into the grocery sector with its planned acquisition of Whole Foods (WFM).
The company announced late last week it would be purchasing Whole Foods in a deal worth $13.7 billion, and shares of both companies shot higher on the news.
While Amazon has turned the retail world upside down over the last decade, the grocery sector has remained relatively safe from its growing retail presence. That will all change assuming regulators allow the deal to go through later in the year.
Amazon’s huge size allows its to negotiate better prices, and should set off a new price cut war among grocers across the nation. It could also start to offer discounts to its Amazon Prime members, which would give consumers one more reason to sign up for the annual service.
Earlier this month we discussed Amazon as being one company that had “The Midas Touch“, and whether or not the company is able put its Midas Touch on Whole Foods and alter the grocery sector the way it has general retail remains to be seen, but for sure there are many companies that are terrified of Amazon’s entry into the grocery sector.
Here are five companies that are shaking in their boots on the news.