I talked with some friends the other day about Whole Foods. They are regular customers. They thought when Amazon bought the company, prices would come down because Amazon is supposedly all about lower prices.
Of course that never happened.
Bottom line - Amazon played the break-even/lose money game for years in order to establish market dominance. They seem to feel they’ve got people locked in now and are raising prices. They are also using agreements with many companies to prevent them from selling things cheaper elsewhere... so Amazon would have the lowest price available, even the price is actually quite high. They claimed to end that practice in 2019, but they actually just renamed the program.
oag.dc.gov
Walmart is still trying to expand its online grocery business. It's tricky for them to try to compete with Amazon online and still retain their in-store business versus other bricks and mortar retailers locally, area by area, and this pricing gig of Amazon's is problematic even for another behemoth like Walmart!
I'm starting to think some of Walmart's sometimes inexplicable behavior online (item by item delivery-available vs pickup-only) might be less about just making sure customers in the stores can lay hands on items, and more about being able to offer better prices to their longstanding in-store customers and so retain them.... exactly because of these Amazon controlled deals. So like some distributor cuts a deal to supply Amazon some item, but Amazon's fine print precludes Walmart or anyone else from being able to jack up online volume by lowering an online price for that item. Sometimes seems it's just one of an array of a brand's product line, like one particular flavoring of beans, or one particular cut-style of some canned veggie. You can get in your car and go get it from Walmart at a good price (not a "sale" price, just a great price) but they won't deliver that particular item via an online purchase at all.
On the other hand what I'm seeing online at Walmart could just be a supply chain issue, thanks in part to covid still messing up everyone's best laid plains including past inventory on hand decisions. And a lot of this stuff is processed abroad or anyway in just a few US locations, so to the extent shipping is still hampered by covid-related transportation or warehouse temporary closures, "anything can happen" and the zillion cans of beans Walmart expected to be parceling out to its own distribution centers right now are bottlenecked somewhere.
Walmart of course has its own way of bearing down on suppliers before it ever even gets to keeping an eye on competitors. Charles Fishman's 2006 book "
The Walmart Effect" is a real eye opener. That turned out to be one of those audiobooks I finally had to buy the ebook version and just read it instead... because it didn't put me to sleep the way I'd figured it would. I'd hit play on it and kill the lights and after 2 minutes I'd be sitting bolt upright in bed saying "
they WHAT??!" and that would go on until the 15-minute timer expired and annoyed me by stopping in middle of some paragraph. Great book but not a bedtime story.
I'm sure Bezos read that book and understood Walmart's been at this game a lot longer than Bezos has when it comes to groceries. But hey, what are lawyers for, he probably figured, and so began to have his raft of legal beagles write these tight-control deals with suppliers.
