I'm not from the US so i have never been to whole foods, but isn't the point of whole foods is that you get a totally different selection than other retailers ? and if so, how could it be a customer for regular grocery products ?
But Whole Foods has a more targeted sourcing strategy for fresh veggies, fruit and meats. They carry more of those organic brands than the usual grocery store.
It's not entirely a "whole 'nother thing" but it is a pretty deep curation of food, food types, brands, and some of the more eclectic, local and smaller food brands.
You get used to Whole Foods but when I visit a Safeway or Raley's, I'm pretty shocked what a more traditional, mainstream grocery store looks like.
That said, and on an unrelated point... though I buy more from Whole Foods than any other grocery chain, the degree to which all the stores have started to be more like each other and less local-driven has been a little disappointing. The Whole Foods in Flagstaff is much the same as the Whole Foods in Roseville.
The first big problem is that the macroeconomics of local tend to suck. The opportunity cost associated with keeping supply constrained in a small market grows in proportion with our ability to reduce transportation costs and integrate national and international markets. Meanwhile, a fragmented patchwork of smaller farms and companies serving local markets tends toward waste: farms invest in the high-end produce they think will maximize yield per acre in the local market. Unit costs per item are higher, and nobody has incentives to produce the essential, but low-margin items that the market still needs.
The second big problem is that consumers don't actually know what local means. Not really, at any rate. Enjoying blueberries in Southern California in the summer? Those aren't local. Oh, but we still want them? And we want them year round? So...I guess we're back at some combination of local + (inter)national, in which case we're still supporting factory farms, giant monocultures, and seed conglomerates -- we've just conveniently pushed these things out of our minds. But they still exist, and we haven't really solved the problems we've set out to fix. The point is, consumers want their goddamn blueberries. And their bananas, which, don't even get me started how much actual blood has been spilled over the international banana trade. (Seriously. Look up Chiquita on Wikipedia. You'll be tempted to use the phrase 'conflict bananas' after reading up. Don't use that phrase. But, like, still. Wow.)
There is probably some sort of ideal market, combining the economic efficiencies of concentration with the variety and quality of specialization. I think we'd all love to get there. But this is the kind of problem Jeff Bezos seems precisely better equipped to solve than John Mackey did.
In that WF's selection is limited based on certain criteria linked to virtue signalling in some portion of the market; much of the grocery selection at WF is also available at other chain retailers, but much of what is available at other chain retailers is categorically excluded by WF.
> and if so, how could it be a customer for regular grocery products ?
Maybe Amazon is interested in targeting the same market segment as WF, and plans on tailoring their grocery operations appropriately.
These days many large chains have organics/natural foods sections; they might have 10-20% organic products, but being much larger there isn't that much that is only found at Whole Foods. Those other stores often have organic sections because people who buy organic food often are not interested in most of what those stores sell. Some chains focus on cost and have very little organic food; the lowest cost organic food is frequently double the price.
Long winded response, but none of what Whole Foods sells is really unique. Also, Whole Foods has limited reach and there may be quite a bit of demand for health food stores that is not currently met, particularly outside large cities. The problem with independent stores is the cost; there are a lot more people who will pay 2x for healthier food than people who will pay 4x or 8x, and enough items need to be 2x to make the store a regular stop. For all the reputation Whole Foods has as being expensive (and it is for many things), part of the key to their success is relatively low cost key health food items. Cooperatives have been able to lower their prices but often still have areas where everything they sell is quite a bit more expensive.
The article has a lot of obvious inaccuracies but might be on to something with the overall theory. If so, hopefully it wouldn't just be regular grocery products but also health foods. It makes more sense than anything else I've heard that Amazon might want to expand the distribution operation while leaving the stores themselves relatively untouched.
More accurately, health and environmental fashion trend / virtue signalling food is their focus; actual health is very much beside the point.