Amazon+Whole Foods: A new player in the industry

  • Reference: IIST-PI-189-E-E

  • Number of pages: 37

  • Publication Date: May 21, 2018

  • Source: San Telmo (España)

  • Type of Document: Case

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Description

With more than 300 million active customers, 380,000 employees, and sales that exceeded 135 billion USD (2016), Amazon announces on June 16th the company’s intention to acquire Whole Foods for 13.7 billion USD. Headquartered in Austin (Texas), Whole Foods leads the organic and healthy food retail market. It has annual sales of over 16 billion USD and more than 477 stores across the US, Canada, and the United Kingdom. This acquisition launches the e-commerce giant into the world of brick & mortar grocery stores and calls into question everything the gurus of the food-chain business strategy had predicted. How to react? How would the industry change?

Learning Objective

The primary learning objective is to understand the two distribution channels, from both Amazon and Whole Foods’ perspectives, as well as Amazon’s reasons to acquire Whole Foods. Along with these two primary lines of debate, participants will also discuss the following: -Will Amazon succeed in running a physical company? -What implications does this acquisition have for the local and global food systems? Can we talk of disruption? -Discuss the role of Senior Management in companies of the Food Chain. -Can the acquisition of Whole Foods be replicated in a market other than the American one? -What does Amazon’s growth look like? -Does this acquisition help to solve the problems that Whole Foods had been dragging?

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Keywords

Adquisition Channels digital Distribution Retail