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Businesses The Almighty Buck

Amazon Just Made Shopping at Whole Foods Cheaper (businessinsider.com) 248

Whole Foods just got less expensive. From a report: On Monday, the day that Amazon's $13.7 billion acquisition of the grocer went through, prices on certain Whole Foods items immediately dropped. On Friday, Business Insider visited a Whole Foods location in the Gowanus neighborhood of Brooklyn, New York, and checked the prices on 15 items (including a few variations on similar items) mentioned by the companies. The total cost of the basket on Friday -- pre-acquisition -- was $97.76. On Monday, we returned to the Gowanus Whole Foods and checked back in on the same items. This time, the total cost of the 15 items was $75.85. That's a nearly 23% drop in the total cost. Whole Trade Banana: 30 cents (Price dropped to $0.49 a pound from $0.79). Lean Ground Beef: $2 (Price dropped to $4.99 a pound from $6.99). Local Grass-Fed 85% Lean Ground Beef: $4 (Price dropped to $6.99 a pound from $10.99). Four-pack of Organic Avocado: $0 (Price stayed at $6.99 for a pack of four). Hass Avocados: $1.01 (Price dropped to $1.49 each from $2.50) for instance.
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Amazon Just Made Shopping at Whole Foods Cheaper

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  • That's the siren song of growing monopolies - economies of scale let them lower prices significantly below the competition... at least until the competition crumbles.

    • Tech news? (Score:4, Insightful)

      by Anonymous Coward on Monday August 28, 2017 @11:05AM (#55096901)

      I missed the part in the article where it mentioned the new technologies they are utilizing to achieve this price reduction.

      Do we really need grocery store slashvertisements?

      • I missed the part in the article where it mentioned the new technologies they are utilizing to achieve this price reduction.

        Do we really need grocery store slashvertisements?

        They did mention the technique of sampling the particular products Amazon/Whole Foods announced as becoming cheaper. That's some mighty impressive new biased sampling technology.

        • Yep, this whole thing is BS. There's every chance Whole Foods just became more *expensive*, but because they only checked the handful of items Amazon hyped lower prices on, of *course* we get told "Yes, they're really cheaper." Lazy journalism abounds, today.
      • I missed the part in the article where it mentioned the new technologies they are utilizing to achieve this price reduction.

        You can buy an Amazon Dot [amzn.to] to go with your avocado dip.

      • >Do we really need grocery store slashvertisements?

        One of the biggest tech companies on the planet that literally revolutionized online buying has moved into grocery space and decides to cut prices dramatically for a "premium" market segment and you don't think there's a tech interest angle there?

    • Re: (Score:2, Interesting)

      by Anonymous Coward
      You are way off base here. That is capitalism and free market competition. It's the way it's *supposed* to work. It sounds like we have a passive-agressive socialist here...
      • by hughbar ( 579555 ) on Monday August 28, 2017 @11:16AM (#55096955) Homepage
        Not really, Amazon is really big and very 'horizontal', so there may be abuse of dominant position [europa.eu] issues (see second bullet point) starting to appear. Of course, I'm a European so very nearly a socialist by definition, even if right-wing.

        Also, I'm expecting (fearing) that all the data and computing fire-power will be used for surge pricing, sooner or later. The stockholders would love it.

        They hardly pay taxes where I live, but they do use all our infrastructure, our legal system, benefit from policing etc. etc. so, like Starbucks and the others, they're not my favourite company.
        • please send us some of your consumer protection.

          - united states

          • But don't send us that insane VAT
            • by Oswald McWeany ( 2428506 ) on Monday August 28, 2017 @11:45AM (#55097165)

              Total tax rate for average person in the US is lower than most European countries... but not by much.

              VAT obviously higher than Sales Tax over here but made up in other ways.

              But what do Europeans get for slightly more taxes?

              Public Healthcare (lower infant mortality, fewer chronic diseases and high expected lifespan).
              Clean-efficient public transport.
              More parks and public spaces in urban areas.
              All schools properly funded, not just ones in areas with wealthy residents.
              Lots... lots... more...

              I'd trade slightly higher taxes if it meant the perks that you get in Europe... ... of course, higher taxes in the US means more money to spend on the military, not on anything useful.

              • Re: (Score:2, Insightful)

                by Anonymous Coward

                That just shows your lack of understanding as to how the US works.

                Taxes in New York are considerably higher than taxes in say, Texas.

                When it comes to taxes, the US is more like a group of countries than it is a single country. So while the total tax rate in someplace like California will be much higher other locations like Oklahoma will have a total tax rate much lower.

                • That just shows your lack of understanding as to how the US works.

                  Taxes in New York are considerably higher than taxes in say, Texas.

                  When it comes to taxes, the US is more like a group of countries than it is a single country. So while the total tax rate in someplace like California will be much higher other locations like Oklahoma will have a total tax rate much lower..

                  That just shows your lack of understanding as to how Europe works.

                  Taxes in Belgium are considerably higher than taxes in say, Latvia.

                  When i

                • It's all finagled so that someone is always making out.

                  In Texas, property tax is high and income tax is nil. This is all part of the default upper class scheme to charge as much regressive tax (usually property and sales tax) as possible so they can pay as little income tax as possible.

                  • To clarify, it's actually probably the upper middle class. Everyone knows the upper class doesn't make regular income.

                  • This is all part of the default upper class scheme to charge as much regressive tax (usually property and sales tax) as possible so they can pay as little income tax as possible.

                    You say that like it's a bad thing. (I'm mostly being serious.. As much as I personally hate usage-based taxes, something like a base vehicle tax + tax for mileage driven seems like it would be better to keep roads/bridges in shape.. But if I want to stay in my house and not go out, paying as little taxes as possible seems reaso

                    • The general interpretation of things like sales tax and property tax is that the lower middle class is much more likely to spend most of their money on groceries and their home than the upper class. I.e., there's a minimum amount of money you have to spend on these things, and the lower middle class spends a larger portion of their income on them. Someone who is wealthy and is still paycheck to paycheck is doing something terribly wrong.

                      Moreover, I would imagine that the upper middle class benefits far mo

              • by ttsai ( 135075 )

                Total tax rate for average person in the US is lower than most European countries... but not by much.

                A recent report [chicagofed.org] from the Federal Reserve Bank of Chicago that compares tax rates in the US and Germany shows that the difference is quite a bit more than "not by much". By almost any measure of tax burden (other than corporate taxes), Americans have a significantly lower tax burden.

                As always, there is no free lunch (unless someone else is paying for it).

                • Everyone pays. Not just someone else. Well everyone that's not rich, and everyone that's not a corporation.

        • by rwa2 ( 4391 ) *

          Eh, every grocery store has had "loss leader" products to get people in the door since forever. Milk and eggs aren't anywhere near that cheap, no?

          Thanks for the list... we might start dropping by Whore Foods for b-a-n-a-n-a-s, but nothing else looks too compelling yet... I usually draw the line for meats at $3/lb., though that's been since the late 90s so I really ought to update that for inflation.

          • Eh, every grocery store has had "loss leader" products to get people in the door since forever. Milk and eggs aren't anywhere near that cheap, no?

            Not here, but Grocery Outlet seems to be the cheapest place to get milk. I think there used to be price controls in CA until a few years ago, but now at GO, a gallon of milk is a bit over $2, at least a buck less than at more well known grocery stores.

        • Also, I'm expecting (fearing) that all the data and computing fire-power will be used for surge pricing, sooner or later. The stockholders would love it.

          Even in the US, that won't necessarily be legal. Price gouging, especially for things like food and water during a natural disaster, is generally frowned upon.

          • Yet Uber gets away with it, so why not Amazon?
            • I'm not certain that Uber would be able to get away with it if there was something like a city-wide evacuation during a natural disaster. Amazon probably wouldn't get in trouble for raising prices on chips and dip the week before the Super Bowl. Raising prices on bottled water the week before a hurricane is forecast to hit is a different story.
        • Also, I'm expecting (fearing) that all the data and computing fire-power will be used for surge pricing,

          What is there to fear about surge pricing? I have no problem with it.

          • by hughbar ( 579555 )
            You probably should do when a) there are no convenient alternative sources for what you want to buy b) they are essentials or near-essentials. I don't mind (well, I do) Uber surge pricing because I have a bicycle and am not afraid to use it.
            • Without surge pricing, the first batch of people to get to the store buy up all the supplies, and then there's empty shelves and no one else gets anything.
              With surge pricing, if you really, really need that can of soup it will be there for you to purchase.

        • Also, I'm expecting (fearing) that all the data and computing fire-power will be used for surge pricing, sooner or later. The stockholders would love it.

          Not exactly surge pricing, sort of the opposite.. but e.g. Safeway apparently does data-mining of what I buy, and very very often gives me deals _on stuff I buy anyway_ that's cheaper than the regular sale prices. (Other stores also do 'deals for you', but I haven't personally used any that as frequently gave me deals on things I bought.)

          I'm all for that,

      • by Immerman ( 2627577 ) on Monday August 28, 2017 @01:44PM (#55097989)

        Yes, it is. Specifically monopolies are one of the oldest and best-understood failings of the free market. As soon as you drive the competition out of business, there's no longer a free market, and you reap the rewards of being the only provider. Meanwhile no new competition arises, because everyone knows that the minute they enter the market the monopolist can drop prices long enough to drive you out of business, so trying to compete is just an exercise in throwing away your startup investment, which could have been better spent entering a market not dominated by a monopolist.

        Capitalism and the free market are social technologies, not holy edicts. Only a fool ignores their very real failings while clinging to an idealized fantasy.

    • That's the siren song of growing monopolies - economies of scale let them lower prices significantly below the competition... at least until the competition crumbles.

      Amazon is not and probably never will be a monopoly anymore than Walmart is currently. They might be able to set prices in some markets that others follow but they'll (probably) never have so much pricing power that they can drive all competition out of the market. Even Walmart has never been able to drive Target and many others out of business. Not everyone competes on price. Nobody shops at Nordstroms because they are bargain hunting. I'm sure Amazon will drive some marginal competitors out but I don

      • Walmart is a joke- they have the actual low cost stuff which is cheap junk and the better stuff is more expensive than you would pay somewhere else.
      • You may find this [twimg.com] to be interesting. Amazon can't put them all out of business, but they can certainly make them all feel some pain.

        Granted Wal-Mart and Target don't truly target the same people, and Amazon will be it's own niche, but it can certainly reduce those companies' profitability considerably.

        • Pain isn't bad (Score:2, Informative)

          by sjbe ( 173966 )

          Amazon can't put them all out of business, but they can certainly make them all feel some pain.

          You say that like it's a bad thing. Amazon is forcing other companies to improve just like Walmart did and others before them. As long as it is to the benefit of people like you and me then bring on the pain.

          Granted Wal-Mart and Target don't truly target the same people, and Amazon will be it's own niche, but it can certainly reduce those companies' profitability considerably.

          There is a heck of a lot of overlap and any reduction in their profitability is only to the benefit of you and me most likely. Amazon is going to go head to head with Walmart in a big way. The largest threat to Amazon is probably Walmart getting their Internet sales up to Amazon's level. Combined w

        • Re: (Score:2, Insightful)

          by Anonymous Coward

          This is an image by someone that doesn't understand the stock market. Market capitalization is something completely different from market share. Market cap is just how much it would take to buy all the shares of a company at the current market price. If some idiot bought Joe's general store in the middle of nowhere for 1 trillion dollars, you would have the same picture except that Joe's would now take up half the picture. A quick peek at the most recent income statement of Wal Mart and Amazon shows Amazon

  • Are these just loss leaders (like every grocery store offers), or is this a real, long-term effort to lower prices at Whole Foods? Will Amazon be taking a loss on Whole Foods or are these prices actually (using one of Whole Foods' favorite words here) sustainable?
    • by fermion ( 181285 )
      Whole foods have been lowering prices for a while, and building more in house products to compete with places like Traders Joe, which has the one of the biggest conglomerate in world behind it.

      This has lead to significant quality and customer service issues, which has in turn lead to people not seeing the point of spending money on products.

      They have always had quite a bit of leeway on products. They tend to have very good values on staples whole grain, eggs, honey, but charge a lot more on the junk fo

      • They tend to have very good values on staples whole grain, eggs, honey

        Not the ones around here. The staples aren't outrageously priced, but they are still more expensive than equivalent products purchased pretty much anywhere else.

  • That's impressive (Score:5, Interesting)

    by Trailer Trash ( 60756 ) on Monday August 28, 2017 @10:59AM (#55096859) Homepage

    They're now within one order of magnitude of the prices at Publix.

    • by Nidi62 ( 1525137 )
      I was just thinking I bought a 6lb pack of 90/10 ground beef at Sams for less than $3.30 a pound, so I fail to see the value in these incredible savings.
      • Re:That's impressive (Score:4, Informative)

        by Oswald McWeany ( 2428506 ) on Monday August 28, 2017 @11:30AM (#55097053)

        I was just thinking I bought a 6lb pack of 90/10 ground beef at Sams for less than $3.30 a pound, so I fail to see the value in these incredible savings.

        Sams meat tends to be artificially lower than what you're really getting. I found that meat from Sams tends to shrink dramatically when you cook it because it is pumped full of water. Some of that $3.30 per pound your paying goes to nothing but water.

        • by Nidi62 ( 1525137 )

          I was just thinking I bought a 6lb pack of 90/10 ground beef at Sams for less than $3.30 a pound, so I fail to see the value in these incredible savings.

          Sams meat tends to be artificially lower than what you're really getting. I found that meat from Sams tends to shrink dramatically when you cook it because it is pumped full of water. Some of that $3.30 per pound your paying goes to nothing but water.

          Even if it is, unless it is 1/3 water you are still getting it for cheaper than what whole foods is selling it for (at the discounted price even). Plus, since we already took that 6 lbs (and it was actually less, I rounded up) and spread it out into 12 portions and froze them, losing some of that weight makes the portions even smaller which helps with weight control. And there is no taste difference between that ground beef and ground beef in fresh packs from Kroger or Publix (the only taste difference I'

        • by Reziac ( 43301 ) *

          Considering I can stand there and watch them cut and package it, you'd think this extra step would be more obvious...

      • What you get at Sam's club isn't local, grass-fed beef. Now maybe you don't care and I'm not sure that I do. But that's a value question, not a price question. Does Sam's club even sell local, grass-fed beef?
      • I was just thinking I bought a 6lb pack of 90/10 ground beef at Sams for less than $3.30 a pound, so I fail to see the value in these incredible savings.

        I do. Not all ground beef is the same. Criticize Whole Foods prices if you like but it's hard to argue that the quality of their meat (and most other) products isn't also better than Sam's in most cases. Whether it is worth the price difference is a different question but you aren't comparing identical products. It is unlikely your package of Sam's ground beef was organic nor is it likely to be of the highest quality. I've bought plenty of meat from Sam's in years gone by and it's fine but it's not as

    • Ah, that feeling when you went for "Funny" and ended up with "Insightful" and "Interesting".

  • These low prices are destructive and will have consequences. If food is this cheap, people won't see the value in socialism and won't unite against capitalist organizations like Amazon.

  • I'll get my raft and float over to our local Houston Whole Foods this morning to stock up.
  • being a hipster place to be seen. yes...the prices kept the hoi-polloi out.
  • ... how in the world is this something that should be a /. article?
  • But what are they going to do about stupid people who think organic food is better and gluten is going to kill them?
    • by erice ( 13380 )

      But what are they going to do about stupid people who think organic food is better and gluten is going to kill them?

      Why would you need to do anything about them? As a retailer, their job is to exploit customer irrationality for profit.

      Aside: the anti-gluten crusade actually has utility for anyone who needs to avoid wheat products. Wheat, especially wheat bran, gives me digestive difficulty. While I'm pretty sure the issue is not gluten, "gluten-free" is a good proxy for "does not contain wheat"

      Alas, much "gluten-free" food contains copious amounts of dairy products, which is another food type I have trouble with.

  • ...the first taste isn't free.

You know, Callahan's is a peaceable bar, but if you ask that dog what his favorite formatter is, and he says "roff! roff!", well, I'll just have to...

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