Tuesday, June 27, 2017

Of Amazon and Whole Foods

Last week it was announced that Amazon is buying Whole Foods.

How this works confuses me.  It represents two ends of a spectrum:  on one end Amazon, a company that has a market model of providing goods as quickly as possible and at the lowest price as possible, a company that is on the forefront of automation and reducing the number of human employees. On the other hand Whole Foods, a company that unashamedly is at the top end of the cost chain in grocery stores and prides itself on paying top of the line for its employees and its suppliers.

The argument runs that this is the way that Amazon can entire into the consumer food market in a way that it has not been able to up to this point (Whole Foods has 431 stores as of June 2017 in the US, Canada and the UK), making it almost an instant competitor with current regional grocery changes.  The thought is that it will also allow it to use its model of quick delivery and lower prices to actually reach the point where groceries are as ordered on-line and delivered as they are purchase in store (and even then, the potential of enabling smart phone purchase technology).

Full Disclosure:  I have used both services. Amazon, of course, for purchasing mostly books (but other things as well).  Shopping is quick, easy, and relatively inexpensive and it all gets delivered to my door.  I have also been to Whole Foods numerous times - but more as a sort of outing than a regular shopping stop (as the prices really are too much to afford for someone on our budget).  It is always a treat but always a treat which we do periodically, not regularly.

How does this end?  Not well for someone, I fear.  Either Amazon will have found out that it has purchased something it cannot absorb into its system and must operate as a totally separate entity or Whole Foods will lose the reason people shop there, becoming just another shopping experience - and one which undoubtedly will have fewer employees.

In a way it is the clash of two visions of the future, the ruthlessly efficient and cost-saving minimal employee model or the high priced service oriented socially feel good  model.

Whoever wins, I suspect I will still continue to get my groceries and my books from somewhere else.  And unfortunately, either way I expect a lot of former employees of one or the other to do the same.

4 comments:

Rain said...

We don't have Whole Foods here in Quebec. I think that Amazon is following Google by trying to take over the world so to speak! I read an article a while back they their intention is to have "clerkless" grocery stores without cash tellers. As you browse through the store and pick up your item, it is "smart" enough as you leave to tally things up and it dings your credit card immediately. I think I got that right. It seems a little too dystopian for my taste!

Toirdhealbheach Beucail said...

Actually, I believe they already have a store for employees that does this very thing. Quite a bit dystopian for me as well.

Whole Foods is something worth walking through at least once to see it. It is a lot of fun. But not something I could afford to shop in or at on a regular basis.

I suppose, should we live long enough and not destroy the world, the final looming battle of Amazon versus Google would be interesting to watch...

Rain said...

Amazon vs. Google...why does this remind me of the Transformers movie lol?

Toirdhealbheach Beucail said...

Not a bad analogy at all, Rain. Large massive behemoths struggling - and crushing everything around them into dust.