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Cultural Changes at Whole Foods Affects Suppliers and Employees

07/07/2018

It is a year since the acquisition of Whole Foods Market by Amazon for $13.5 billion. After an initial cautious start, the impact of Amazon on Whole Foods is now becoming apparent. There have been extensive layoffs in the 460 stores in the chain with calls for unionization. Executives committed to the philosophy of founder John Mackey have left the company to be replaced by Amazon stalwarts.

Sourcing decision are now more centralized in the company headquarters in Austin and local suppliers have been sidelined. Centralized merchandising, which has facilitated in-store layoffs, will cost suppliers approximately 3 percent for restocking at a rate higher than competing chains. This has elicited criticism from the Specialty Food Association as noted in a feature article by Heather Haddon in the June 3rd edition of The Wall Street Journal.

Whole Foods Market anticipates increased sales from rationalization and the tie-in with Amazon Prime and two-hour delivery service in high-density urban areas.

Irrespective of the financial outcome, the character of Whole Foods Market has changed providing opportunities for clones and competitors.