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Published: Thu, June 22, 2017
Economy | By Melissa Porter

Small food makers wonder about Amazon-Whole Foods impact

Small food makers wonder about Amazon-Whole Foods impact

But words are in the market that this won't be the last bidding amount after the share price of Whole Food closed on $43.22 a share with a rise of 54 percent in its share price.

Amazon announced its offer to purchase Whole Foods Friday for $13.7 billion in cash.

Mackey's comments regarding his investors are interesting, considering that a 2015 Business Insider investigation found that Whole Foods was charging 45 percent more than Kroger for identical products.

"We have been asked by investors and media over the past few days, in nearly breathless tones, 'What does Walmart do?' and 'Isn't Walmart scared?'" O'Shea said.

Although Whole foods Market Inc might expect a bidding war but it would be very hard for other competitors to sustain against the retail giant whose current stock market value is $475 billion. "And Walmart, already the world's largest retailer, also is the world's biggest grocer".

"We expected Amazon to be raising capex over the next five years in order to build out the infrastructure for groceries so this acquisition in effect accelerates this, with Whole Foods having already spent 400 million U.S. dollars per year (£312.5 million ) for the last five years".

With more than 5,330 locations throughout the USA that are within 10 miles of 90 percent of the population, there's no company better positioned than Walmart to dominate the grocery industry, he said. Speculators won't be surprised if they visualize a bidding war for this grocery retail giant player in the market which has more than 465 stores across the country that primary focus on selling organic groceries.

The company has doubled the number of Neighborhood Market stores to 700 over the last three years. Whole Food Market Inc had suffered a huge downfall in their share prices since 2013 when their share prices were at its peak and nearly double of what it is right now.

The smaller-format stores are convenient for fill-in trips between visits to Supercenters or Sam's Club, and prices are comparable to Walmart's Supercenter prices.

Even as more customers are clamoring for online grocery ordering and speedy delivery, many shoppers place high value on the benefits of going to a physical store.

Due to Amazon's reputation for pioneering automation in bricks-and-mortar retail, including its checkout-free pilot stores in Seattle, employees have been left wondering why they have not received a statement assuring them of their future employment.

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