Amazon To Expand Whole Food Stores Across The US One Year After Buying Grocer

The e-commerce giant acquired Whole Foods in 2017 for about $13.5B

Amazon (AMZN) is planning to expand Whole Foods stores across the U.S. in push to widen the tech giant’s delivery reach, according to a report from Heather Haddon and Laura Stevens of The Wall Street Journal. This represents a shift from the layoffs and slowing store growth the natural grocer experienced for several years before being bought by the e-commerce giant.

WHOLE FOODS EXPANSION: Amazon is looking to build and expand Whole Foods stores around the U.S. in order to have more customers in range of its two-hour grocery delivery, people familiar with the matter told The Wall Street Journal. The push would bring Whole Foods to more suburbs and other areas where the grocer is rapidly adding customers since the merger last year, the report noted. One person familiar with the plans said Whole Foods employees have visited potential retail spaces in parts of Idaho, southern Utah and Wyoming, where the natural grocer does not have any stores. The e-commerce giant offers Prime now, a two-hour delivery option to members of its Prime subscription service in over 60 cities and online grocery pickup from Whole Foods stores in 30 minutes from about 30 cities. Amazon plans to expand those services to nearly all of its roughly 475 Whole Foods stores in the U.S., a source told The Wall Street Journal.

INSTACART ENDING RELATIONSHIP WITH WHOLE FOODS: Earlier this month, Recode reported that delivery startup Instacart’s five-year relationship with Whole Foods was winding down now that the grocer is owned by Amazon. Instacart will begin pulling the first group of 1,415 workers out of its 76 Whole Foods locations in February and expects to be able to offer 75% of those workers employment elsewhere, the publication noted. This comes has Amazon steadily ramps up its own free two-hour delivery service from Whole Foods stores for Amazon Prime members.

PRICE ACTION: In late morning trading, shares of Amazon have gained over 1% to $1,494.

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