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Reuters reports that Instacart announced yesterday that it will sever its delivery relationship with Amazon-owned Whole Foods next year, finally ending a relationship that was doomed from the moment Amazon bought the bricks-and-mortar retailer.

The story notes that “Amazon’s $13.7 billion purchase of Whole Foods in August 2017 has been a double-edged sword for Instacart, throwing the Whole Foods relationship into doubt while driving rival grocers such as Kroger, Aldi and Costco into Instacart’s arms.”

Reuters points out that “Instacart bagged the Whole Foods delivery deal in 2014, elevating its brand with influential young consumers who want everything from groceries to sofas delivered to their doorsteps. In 2016, the companies deepened their relationship, forging an exclusive, five-year agreement to deliver perishables.

The divorce will begin taking affect in February 2019.
KC's View:
This isn’t just about separating from a company that also is a competitor. This is about Amazon taking greater control of its assets … understanding that effectively exploiting the synergies between its businesses hopefully adds to the value of both.

Instacart’s business model, whether or not it wants to admit it, is founded on creating a separation between retailers and their customers, and establishing its own brand as an alternative to its customers’ brands. Eventually, Instacart’s customers will get that message, and realize that you can’t be a little bit pregnant.