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Amazon to Acquire Whole Foods for $13.7B

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Re: Amazon to Acquire Whole Foods for $13.7B

#131

Post by zeckalpha »

pjc50 wrote: post #41
phreeza wrote: post #21

Somewhat off topic, but I have had a weird thought circulating in my head (triggered by reading Red Plenty) that I wanted to put out there: What is the relationship between a centrally planned economy as for example Gosplan was trying to run in the USSR, and the presence of these huge market-like but centralized entities like Amazon and Wal-Mart inside a free-market economy? This becomes particularly interesting beca…

The observation was made in "Theory of the Firm" a long time ago that companies tended to be command economies internally, rather than having internal markets; and the hypothesis supported that this is due to informational costs. WRT redistribution, I suspect the shareholders would jump on that.

The Amazon services imperative sounds like a driver toward internal markets.

Re: Amazon to Acquire Whole Foods for $13.7B

#133

Post by VT_Drew »

emodendroket wrote: post #102
Joakal wrote: post #96

Earlier quoted context omitted.

Treating them above market or not, Amazon acquired the company for billions and not because Whole Foods was doing badly.

It says right in this article (and in others that have been published recently) that they were under pressure from investors.

Good old investors, so short sighted, they only care about the next 3 months. Whole Foods probably would have been better off as private company, especially with the culture they were trying to create.

Re: Amazon to Acquire Whole Foods for $13.7B

#134

Post by tmaly »

Grocery stores are a tough market with razor thin margins. Whole Foods has a ton of competitors like Trader Joes that happens to still have organic options.

Since I did not see it asked, any idea if we will see some new Prime benefit at Wholefoods?

Re: Amazon to Acquire Whole Foods for $13.7B

#135

Post by dx034 »

Accacin wrote: post #74
illumin8 wrote: post #55

Earlier quoted context omitted.

Disclaimer: I work for AWS, but my opinions are my own. I don't think you have much to worry about if you're a WF employee. Amazon actually treats their employees very well. In my experience here, I've never seen any of the things the NY times article talked about, either on my team or any other team I've interacted with. People have a healthy work/life balance (40-50 hours a week), get paid very well (definitely abo…

> People have a healthy work/life balance (40-50 hours a week) 40-50 hours of work a week isn't healthy.

Why not? The important part is commute. 50hr work week in a job you like with a reasonable commute is no problem for your health. 30hr/week in a job you don't like with 2.5hr in traffic each day is much less healthy.

Re: Amazon to Acquire Whole Foods for $13.7B

#136

Post by aezell »

phreeza wrote: post #21

Somewhat off topic, but I have had a weird thought circulating in my head (triggered by reading Red Plenty) that I wanted to put out there: What is the relationship between a centrally planned economy as for example Gosplan was trying to run in the USSR, and the presence of these huge market-like but centralized entities like Amazon and Wal-Mart inside a free-market economy? This becomes particularly interesting beca…

Ordered the book based on the fact that it helped you make these connections and hypotheses. Must be a good book.

Re: Amazon to Acquire Whole Foods for $13.7B

#137

Post by rayiner »

Joakal wrote: post #96
emodendroket wrote: post #32

Earlier quoted context omitted.

Maybe, but the fact that they were just acquired by a company notorious for abusing its low-level employees shows the limitations of this model (as did the pressure they began to face from investors to tighten up on that front when they started to become less profitable).

Treating them above market or not, Amazon acquired the company for billions and not because Whole Foods was doing badly.

A lot of time when companies like that get acquired, someone is hoping to profit on the difference between the purchase price, and the value of the company when the management culture switches to wringing every last bit of productivity out of employees. Amazon might have a more strategic goal, but the above strategy is a common one.

Re: Amazon to Acquire Whole Foods for $13.7B

#138

Post by ghaff »

ccorda wrote: post #106
maxerickson wrote: post #56

Earlier quoted context omitted.

I don't think that is right, Whole Foods stores are already full of...food. They don't have room for hundreds of additional products, never mind tens of thousands.

Place an order by noon for groceries plus anything you want from Amazon. Amazon fills up truck(s) at whatehouse and drops off at local Whole Foods. Stop by on your way home from work and they bring your items to your car. You get free same day delivery. Amazon just greatly saved on last mile delivery costs. That's the value of those nodes without having to store all the inventory.

Hannafords has a place an order and pick it up model. Anecdotally, based on my local store, hardly anyone uses it. I suspect it's a narrow niche where people are happy to order on their computer but want to save a few $$ on delivery.

Re: Amazon to Acquire Whole Foods for $13.7B

#139

Post by cma »

ckastner wrote: post #65
AndrewDucker wrote: post #23

https://twitter.com/dkberman/status/875701677504024576 "Amazon did not just buy Whole Foods grocery stores. It bought 431 upper-income, prime-location distribution nodes for everything it does."

$13.7B / 431 = $31.79m per store. I have zero experience with real estate prices for retail outlets, but it feels as if that's a bit on the high end?

Are they all even owned or are some leased?

Re: Amazon to Acquire Whole Foods for $13.7B

#140

Post by travisp »

wu-ikkyu wrote: post #86
AndrewDucker wrote: post #35

Earlier quoted context omitted.

The major difference is that if Amazon stop running well then someone else will come along and replace them. Whereas government is a monopoly, so if it runs badly then it doesn't automatically get replaced. Now, democracy is supposed to fix this, by allowing you to vote for a different supplier of government every few years. But because of the voting system in some countries (like the US and the UK) it's actually rea…

>if Amazon stop running well then someone else will come along and replace them Is this really true though? Over the past few decades we've seen that if a company is big enough, and it fails, the government will step in and prop it up with a bailout.

If that's the case, it's not a free-market economy, and you won't get those benefits of the free-market economy.
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