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Whole Foods Antitrust Analysis

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Summary: Antitrust concerns have been raised after Amazon’s purchase of Whole Foods for $13.7 billion. Democrats in particular have asked how the purchase may affect consumers who have limited food shopping options -- antitrust concerns are part of their political agenda. Whole Foods is expecting to close the deal during the second half of 2017 and many analysts speak of benefits that would come from this deal such as lower prices and delivery innovations; they also state that Amazon would still face competition from other major retailers such as Target and Walmart. The concerns have mainly stemmed from the various effects of consolidating other U.S. businesses such as airlines and banking. Amazon is planning on resubmitting paperwork to the …show more content…

Online shopping offers convenience and ease that many consumers prefer over going out to a store and physically purchasing a good. It is intriguing to see that a store like Amazon would be looking to get involved in the supermarket industry, and as Stephen King once said, “I like Amazon as much as anyone, I guess, but leave food prep to the people who understand it and do it well. That would be Blue Apron.” I would still prefer to buy my groceries at a supermarket, but it will be interesting to see how the merger works out for both Amazon and Whole Foods. I do share the same fear as the Democrats in that it is worrying that Amazon could become a monopoly in the supermarket industry since it is a very likely possibility. I also worry about what it will mean for families who rely on stores like Whole Foods only to have that taken away from large online corporations. There have been other mergers of companies that were much more costly than $13.7 billion. Bell Atlantic and Vodafone combined to found Verizon Wireless -- it went on to become one of the biggest phone service companies in the U.S. One of the biggest mergers was AOL 's acquisition of the Time Warner company in 2000 -- it was a total $164 billion. The merger with Whole Foods will definitely be beneficial for Amazon because it is expanding to a whole new industry and will appeal to a different crowd. I hope that the effects on consumers will not be major and that Amazon will not face any

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Two college dropouts borrowed money from family and friends to open a small business called Saferway in Texas. This occurred in 1978 by John Mackey and Renee Lawson (Hardy). In 1980 the two joined forces with Craig Weller and Mark Skiles and created Whole Foods Market. Seven months later Texas got hit with the worst flood in history.

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In the introduction of Food Justice by Robert Gottlieb and Anupama Joshi they talk about how Hurricane Katrina ruined so many schools. They saw this as an opportunity to rebuild their school system. A group of middle schoolers want to voice their opinion and be heard they were called the Rethinkers. They wanted to fix their school system and that was including the meals that they received. They went to local shrimp producers who were also struggle after the storm and they said that major issue was development of industrially farms.

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Then in 1988, a New Orleans store was acquired, followed by one in Palo Alto, California that following year. This growth continued during the 1990’s with over a dozen mergers of smaller natural groceries stores across the nation and the success continued into the early twenty-first century with John Mackey still at the reins, leading the company as CEO. Challenges grew as well with Whole Foods involvement in several issues related to Business Ethics, including unethical decisions, careless handling of relationships among rivals, complaints of violating anti-trust laws, and controversial activity by the CEO. In addition to Whole Food’s products being considered too expensive, they were also criticized for their acquisitions of small community grocery stores. Numerous residents did not want their stores bought out or closed down, they worried about the impact on the smaller

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Comparison between Staples-Office Depot proposed merger (1997) and Office Depot-OfficeMax merger (2003) Abstract: Both of Staples-Office Depot merger in 1997 and Office Depot-OfficeMax merger in 2003 are horizontal mergers between leading office supply stores, while the Federal Trade Commission denied the Staples-Office Depot merger in 1997 and approved the Office Depot-OfficeMax merger. The changes in the Federal Trade Commission’s decisions are derived from the significant changes in the office supply market, such as the stiff competition in the office supply market and the technology impact. This article compares these mergers from three respects in the Federal Trade Commission’s decision: relevant product market, anti-competitive effect

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Metro has had an eye on merge and acquisition upon combination in the retail sector, such as Loblaw's invest in of Shoppers Drug Mart in 2013, as well as the appearance of new rivals, such as Amazon and Walmart. For customers, its great news due to the fact they'll be capable to get merchandise at a cheaper cost, it represents a significant change in Canada's grocery business. We consider that a Metro/Jean Coutu combination makes tactical sense, just as the Loblaw/Shoppers incorporate did. This was the greatest chance for Metro to obtain scale in Canada. Metro runs grocery stores under a few banners, such as Metro, Metro Plus, Super C and Food Basics, as well as more than 250 drugstores, own by the Brunet, Metro Pharmacy and Drug Basics banners.

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When considering mergers, there are two major motives that would be advantageous from the standpoint of society, those include synergies and tax considerations. The definition of synergy is when two separate companies form a new company and the value of the new company is greater than the value of the individual firms. A merger for synergistic reasons would have to be favorable for shareholders from both individual companies. According to Brigham and Ehrhardt, (2014), “Synergistic mergers should provide value to shareholders from both companies and arise from five sources: (1) operating economies of scale in management, marketing, distribution or production. (2) financial economies, including lower transaction costs and better coverage by security analysts.

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As The largest retailer in the nation, it pays a very positive role, giving jobs and producing goods, that americans want to and can buy. With out Wal-Mart it may be a whole different

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Customer Analysis Kroger is a large grocery chain which has stores all over the U.S. They bring in many different types of customers due to their wide spread location. In this section, a customer analysis will be broken down into three main components which are: Customer characteristics, consumer demands, and market segments. Customer Characteristics A study done in 2014-2015 by infoscout has determined that the main demographic that shops at Kroger are usually in the age group of 65 years and above.

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This reputation has prompted Whole Foods Market to introduce separate stores that are designed specifically for millennials (Bolton, web). There is no evidence about how these new stores will affect Whole Foods Market, however there is evidence that the population of America, where most of Whole Foods Market stores are located, is getting older. While the number of birth is estimated to out pace the number of deaths in the United States, people are estimated to be living longer since the population is living longer because of this Whole Foods Market’s focus on the younger population may not be beneficial (U.S. Census Bureau, Demographic Internet Staff, web). Whole Foods Market used demographics to create a new type of store and that kind of demographic that it focuses on is going to have to be watched as time goes on to determine if changes to the new stores will need to change.

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To begin, Whole Foods builds human and social capital by admiring their employee’s cognition and admiring their employee’s relationships with their peers and supervisors. The meaning of human capital is the conceivable knowledge and actions of human beings (Kreitner & Kinicki, 2013). Whole Food’s displays an excellent job of displaying human capital by hiring individual’s that will provide their knowledge drive the company in the direction it needs to go. Employee cognition in any business is important for the company’s growth (Coff & Raffiee, 2015). Whole foods emphasize dexterous conception for employees, customers, and the environment, which in return, leads to their high profitable business (Cheretis &Mujtaba, 2014).

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Furthermore, research has shown that there is a high percentage of overlap between Amazon Prime and Costco membership holders. Should Amazon take over the grocery marketplace, Costco could see a serious decline in

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Amazon is currently a behemoth of American business. It's the 56th greatest association in America by business area capitalization. It's the fifteenth most noteworthy retailer in America by salary and by far the greatest Internet retailer. Besides, a country that seems, by all accounts, to be starting now charged by e-exchange, the association has a huge amount of space to create. In the wake of stripping out things like fuel arrangements that can't move to the Web, Raymond James examiner Aaron Kessler assessments that e-exchange identifies with roughly 12% of retail arrangements as a rule, and that that figure could twofold in the accompanying 10 years.

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In In re Baby Food Antitrust Litigation, 166 F.3d 112 (3d Cir. 1999), the plaintiffs were trying to prove a horizontal conspiracy among Gerber, Heinz, and Beech-Nut. To begin with, there were no direct evidence that these three manufacturers of baby food expressly agreed to fix prices or divide markets in violation of section 1 of the Sherman Act. Then, circumstantial evidences exist for conscious parallelism -- ostensibly independent firms consistently set prices at the same level and update prices at the same time. The class of store owners introduced evidence of e-mails indicating occasional price information exchange or advance notice among sales representatives employed by the three companies. However, conscious parallelism is insufficient

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Amazon is number one in competing Walmart especially in online retailer and now opining fiscal stores starting with Amazon Campus store in 2015, available at several college campuses in US the Amazon Campus stores serve as a central hub where student retrieve deliveries from lockers and drop off returns, all free of charge. Over the past three years, while Walmart’s sales grew by 8.6 %, revenue at Amazon has nearly doubled. Then, Costco is also major competitor to Walmart, particularly to Sam’s because of its low price.

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