Amazon is laying the groundwork to return Whole Foods to growth mode, adding new stores in the suburbs and states where the upscale grocery chain doesn’t currently have a presence, according to a report Sunday morning in the Wall Street Journal.
The strategy is designed in part to expand the reach of Amazon’s Prime Now two-hour delivery and grocery pickup service, the report says, noting that some of the new stores will be larger than normal to accommodate the additional operations. Amazon’s Prime Now service is available via some Whole Foods stores currently, but a source tells the WSJ that it will be expanded to nearly all Whole Foods stores in the country in the future.
Amazon, which acquired Whole Foods for $13.7 billion in 2017, hasn’t yet responded to our request for comment on the WSJ story.
Whole Foods is separately discontinuing its delivery partnership with Instacart, an arrangement that predated the Amazon acquisition.
The WSJ doesn’t say how many new Whole Foods stores will be added, or how quickly the expansion will take place. Whole Foods currently has about 475 stores, but the Austin-based chain doesn’t have a large presence in many inland regions of the country, as shown in this GeekWire graphic from last year, with green shading indicating states with higher concentrations of Whole Foods stores.