How much Whole Foods could drop their prices

Posted at 5:57 AM, Aug 28, 2017
and last updated 2017-08-28 13:15:21-04

Amazon officially takes over as the owner of the struggling Whole Foods Market on Monday, and that means prices will be cut immediately.

The online retail giant says prices at Whole Foods stores will go down for organic bananas, avocados, large brown eggs, farmed salmon and tilapia, baby kale and baby lettuce, 85% lean ground beef, almond butter, Gala and Fuji apples, rotisserie chicken, and the 365 Everyday Value organic butter.

A spokeswoman for the chain wouldn't say by how much, however.

Analysts told 10News that Whole Foods generally charges 15 to 25 percent more than its competitors for its organic items.

San Diego State University marketing professor Miro Copic said he expects the grocer to drop prices to either match or be within 10 percent of Vons and Ralphs. Whole Foods operates on wider margins than its competitors, so it has room to lower prices.

Amazon Prime, which costs $99 a year, will soon serve as Whole Foods' loyalty program.

"Competition keeps a keen eye on each other," said analyst Bob Gorland, Vice President of Matthew P Casey and Associates. "If Whole Foods comes down in some areas, particularly with use of loyalty cards, suddenly other chains are sending out emails or special mailers to try to combat them."

Marisa Rojas, who lives across from the Whole Foods store in Hillcrest, said she likes the selection of bread, cheeses and beers, but she doesn't shop there much.

"It's a little pricey for a graduate student stipend," she said, noting she will start coming back once the prices drop.

Whole Foods CEO John Mackey said in a statement that the price drops won't mean quality does too.

Amazon will also install its lockers in Whole Foods stores, so people can ship and return packages at their local market.