Whole Foods Market said it will lower prices on hundreds of grocery items this week, the latest effort to reshape the grocer’s pricey image under Amazon.com Inc.
The Seattle retail giant touted a round of price cuts immediately after buying Whole Foods in August 2017, and over the last year it worked to roll out grocery delivery from stores and introduce discounts for Amazon Prime members. Whole Foods, which operates fewer than 500 stores, said the new price cuts average about 20%.
Amazon acquired Whole Foods in an effort to catch up to Walmart Inc., Kroger Co. and Costco Wholesale Corp. in grocery sales. It still has a long way to go. There are about 10 Walmart locations in the United States for every Whole Foods store.
Rival grocers such as Sprouts Farmers Market Inc. and Kroger — whose chains include Ralphs and Food 4 Less — saw their stocks slip on the news. Amazon shares rose 1.9% to $1,814.19.
There have been grocery price increases at Whole Foods too: The Wall Street Journal reported in February that rising costs for packaging, ingredients and transportation had pushed the chain to raise prices on hundreds of items late last year and in early 2019. The Journal also reported the news of the current price cuts earlier Monday.
Whole Foods said in an emailed statement that the grocery industry as a whole was dealing with higher costs and that it had absorbed much of the price increases instead of passing them along to customers.