Can super-sustainable farm fresh foods survive the Amazon-Whole Foods deal?
- While Amazon may drive to push Whole Foods’ prices down, some farmers who make their money using super-sustainable processes that appeal to Whole Foods' shoppers are nervous about the further elimination of family farms and their livelihoods, reports Fast Company. The prices, while expensive —such as $8.99 for a dozen eggs — allows farmers and producers to earn a living and maintain responsible farming practices.
- “One of the contributions that Whole Foods has made to the farm community is that they have featured products, especially organic, that provide a price back to the farmer that is more reflective of the actual cost of production,” Scott Marlow, executive director of Rural Advancement Foundation International, told the publication.
- Farmers also are concerned about losing other forms of support historically provided by Whole Foods, including grants offered to small producers to help them improve their products and shelf space that typically is reserved for locally sourced products and new startups.
No one can predict with any certainty what will happen with Whole Foods once the Amazon acquisition is approved. Farmers that practice super-sustainable processes such as those profiled by Fast Company hope their relationships with Whole Foods survive and remain intact under Amazon ownership. Still, they are right to be concerned about their future.
There is looming uncertainty as to how much the online giant will be able to help an inefficient, slow-to-adapt retailer with 460 stores and a major pricing problem. Most analysts agree Amazon could do a lot to improve Whole Foods’ operations by bringing economies of scale and efficiencies to help drive down costs—consumers would be the long-term winner with lower prices at the organic and natural foods pioneer.
“The first thing Amazon needs to do is lower prices,” Brian Yarbrough, senior research analyst with Edward Jones, told Food Dive. “Whole Foods is overpriced, and they’ve lost customers as a result.”
Through Amazon, Whole Foods will have the opportunity to offer not just lower prices but smarter prices by leveraging the online retailers’ data prowess. While price reductions could go a long way toward broadening Whole Foods’ appeal, the retailer may ultimately need a new look or at least some new brands that offer better value positioning.
So where does this leave responsible and super-sustainable farmers such as Straus Family Creamery, which sells milk at Whole Foods for $3.39 a quart in returnable glass bottles, or Stueve Organic, whose eggs costs $8.99 a dozen? They have a right to be nervous since it remains to be seen if Whole Foods can retain such high-end, specialized, niche products under Amazon ownership, or if it will move more mainstream.
Still, Amazon is on record telling Fast Company, “We will want Whole Foods to keep doing what it does best, including working with small farms and producers to bring the best natural and organic foods to customers.”
Some hope and optimism remains for the small super-sustainable family farm — but for how long? These farmers would be wise not to put all of their eggs in the Whole Foods basket.
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