Coronavirus Has Been ‘Uniquely Horrible’ For Whole Foods

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Flickr/Ines Hegedus-Garcia

What happens when a grocery store nicknamed “Whole Paycheck” is faced with millions of potential consumers losing their paychecks? Apparently, nothing good.

Whole Foods, the high-end grocer purchased by Amazon for over $13B in 2017, had 25% less foot traffic in September than it did in the same month of 2019, according to Placer.ai data reported by Bloomberg. Though its overall sales have risen year-over-year by as much as 10% thanks to online sales, that growth is less than half than some of its competitors, according to data from Earnest Research also obtained by Bloomberg.

Though Whole Foods has been a boon for multifamily buildings that it anchors, its refusal to stock common, mass-produced kitchen staple items has prevented it from being a one-stop shop, Bloomberg reports. Now that efficiency and avoiding prolonged periods in public and indoors has become a higher priority, millions of customers have excised Whole Foods from their routines. Research firm Numerator estimates that 4.5 million fewer households have shopped at Whole Foods since March compared to the same period in 2019.

Whole Foods was a central element to Amazon’s push to move more grocery shopping online, whether for in-store pickup or home delivery, but the coronavirus accelerated that trend to the point where it may no longer be beneficial. Consumers in multiple urban markets complained about crowded stores and long lines to enter to Bloomberg, which some attributed to the prevalence of pickers for online orders.

Online orders tend to be smaller than in-store shopping, Bloomberg reports, making the trade-off less than even. And because of pandemic-driven necessity, more grocery chains have been forced to integrate online ordering into their business, erasing Whole Foods’ advantage in that area.

Though Amazon has reportedly considered adding more facilities dedicated entirely to online orders to preserve the in-store experience, so far it has yet to move forward on any beyond the first it opened in Brooklyn. Some outsiders and anonymous store managers told Bloomberg that they don’t trust Amazon to fully commit to adapting while its attention is focused on building its own grocery store brand, Amazon Fresh.

https://www.bisnow.com/national/news/retail/whole-foods-pandemic-effect-uniquely-horrible-106264

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