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Published: Sun, August 27, 2017
Economy | By Melissa Porter

Amazon to complete acquisition of Whole Foods on Monday, cut some prices

Amazon to complete acquisition of Whole Foods on Monday, cut some prices

Customer may have products shipped from Amazon.com to their local Whole Foods for pickup, or consumers may send returns back to Amazon via the lockers.

Monday is also the day that Amazon's $13.7 billion (£10.7 billion) acquisition deal with Whole Foods Market will be closed, and it is being viewed by industry experts as the online retail giant's strongest and most direct push into bricks-and-mortar retail.

Thursday's announcement is also notable because Amazon has been mostly mum about what it plans to do with Whole Foods, with many left to speculate over what a tie-up of the two companies would look like.

Amazon also plans to begin selling its Echo and Echo Dot Alexa-powered speakers in select Whole Foods location.

Eventually, Amazon Prime will become the Whole Foods loyalty program once technology teams can integrate Prime membership data into the Whole Foods point-of-sale system.

In June 2015, New York City's Department of Consumer Affairs actually accused Whole Foods of "systematic overcharging for pre-packaged foods" - as much as $14.84 for a package of coconut shrimp. Amazon has said it will keep the Whole Foods name on stores and retain CEO John Mackey.

With a drop in prices, Amazon can bring people in who want to shop at Whole Foods, but didn't want to pay the higher prices. The deal meant that Amazon would gain control over all 465 Whole Foods stores across North America and the United Kingdom. "We will make Amazon Prime the customer rewards program at Whole Foods Market and continuously lower prices as we invent together". But the big picture, she says, is less about growing Whole Foods' sales and more about increasing Amazon's presence in the real world.

"They will lower prices on consequential items to drive traffic and sales but not do a whole store price reduction which could really damage gross margin".

Whole Foods prices will be cut on top-selling grocery staples including organic bananas, avocados, apples, large brown eggs, butter and rotisserie chicken, farmed salmon and tilapia, lean ground beef and almond butter. And items from Whole Foods' own brands will be available for purchase on Amazon.

Whole Foods' headquarters will remain in Austin, according to Amazon.

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