Amazon closes two UK Whole Foods stores just two months after completing its £10.7bn takeover
Amazon is shutting two Whole Foods shops in the UK just two months after completing its £10.7bn takeover of the upmarket grocery chain. The company is closing down its stores in Cheltenham, Gloucestershire and Giffnock, East Renfrewshire meaning that there will be just seven UK shops remaining, all of which are in London.
Industry sources said that the decision to shut the stores made sense as neither shop could be serviced by Amazon’s online grocery service. Amazon Fresh has only recently been expanded from London to include Hertfordshire and Bedfordshire.
“It makes perfect sense for Whole Foods to close both stores from a business standpoint, the logistics must be nonsensical,” commented Steve Dresser from Grocery Insight.
“I think it marks the new age from Amazon where the balance sheet is scrutinised and sacred cows in Gloucester and Scotland aren’t permissible just to ‘spread the brand’.”
In contrast to the US – where Whole Foods’ 440 shops help to boost Amazon’s grocery distribution network – in the UK Amazon is largely using its Whole Foods acquisition to broaden the range of groceries available on its Amazon Fresh and Prime Now services by including items such as organic baba ganoush, crostini and fillet steak.
It has also attempted to widen the Whole Foods appeal by slashing prices on some staple goods, such as apples, to become more competitive. However, the overwhelming majority of Whole Foods goods are still much more expensive than rival supermarkets.
“A decision on the future of the stores will be made after the company has consulted with team members to discuss the proposal,” a company spokesperson said. “In the event that the decision is taken to close the stores, we will work with team members to explore alternative employment opportunities.”
Around 150 people are currently employed at the two Whole Foods shops.