retail news in context, analysis with attitude

Amazon may be making much of the news in the supermarket business these days because of its proposed $13.7 billion acquisition of Whole Foods, but Business Insider points out that Walmart, along with its Sam's Club division, remains the nation's dominant grocery retailer, owning more than 20 percent of the market.

A study by UBS points out that the market is highly fragmented, "split between dozens of other players, including Kroger (10%), Albertsons (5.2%) and Costco (4.2%)."

Those who hope that federal regulators may stop the Amazon-Whole Foods deal on antitrust grounds may be disappointed to learn that "Whole Foods controls just 1.4% of the market, making it the 13th largest grocery chain in America. Amazon, meanwhile, claims just 0.2% of the grocery market."

However, some hopes remain in this group, as Reuters reports that "while antitrust experts expect Amazon.com Inc's bid for Whole Foods Market Inc to win regulatory approval, some critics argue the deal should be blocked because it gives the online retailer a nearly unstoppable head start toward domination of online grocery delivery. They argue the Whole Foods acquisition will give Amazon an unfair advantage over traditional grocers and new players that might emerge in the market, potentially grounds for the deal to be blocked for antitrust reasons."
KC's View:
It is hard for me to imagine that this deal could be derailed by antitrust regulators, especially because combined, Amazon and Whole Foods will have a whopping 1.6 percent of the grocery business.

If this ends up with Amazon growing into having domination of the online grocery business, then shame on their competitors. Last time I checked, antitrust regulators don't make decisions based on what might happen.