In a letter to shareholders earlier this month, Amazon CEO Andy Jassy said the grocery business needs to be a focal point of the company’s strategy, despite its recent struggles. Jassy stressed the need to find a mass grocery format that’s worth expanding broadly, saying that a larger physical store footprint is needed since most grocery shopping is still conducted at brick-and-mortar locations.
On that note, Business Insider reported that analysts at Bernstein put together a comeback strategy for Amazon’s food retail business, the main component of which is purchasing existing stores that would be closed due to the proposed Kroger – Albertsons merger. The merging grocers are expected to close up to 500 stores, many in areas that could be favorable for Amazon.
And Bloomberg Intelligence’s Poonam Goyal told Yahoo! Finance that Amazon owns a tiny piece of the grocery sector and could be looking to grow their footprint through acquisitions. He added that Amazon doesn’t have the expertise to build the grocery business with scale.
So, time will tell as to whether Amazon attempts to grow its brick-and-mortar grocery business by purchasing individual stores on the Kroger – Albertsons chopping block, or via an acquisition of an existing chain or chains.