Amazon.com Inc (NASDAQ:AMZN) is taking tighter control of Whole Foods Market, ending much of the autonomy the grocery chain retained since its $13.7 billion acquisition in 2017, as part of a sweeping reorganization of its grocery operations.
The move, revealed in a leaked internal memo, will see Whole Foods’ corporate employees shift to Amazon’s internal pay and performance management systems. It marks the most significant integration step yet in Amazon’s grocery strategy, which also includes Amazon Fresh and Amazon Go.
Jason Buechel, who serves as both Whole Foods CEO and Amazon’s head of grocery, said the prior organizational setup led to "duplicative efforts and did not maximize employee potential," according to the memo cited by Business Insider.
Sales at Whole Foods have risen by about 40% since Amazon’s acquisition, but the e-commerce giant’s share of the US grocery market still trails major incumbents like Walmart and Kroger. The restructuring aims to streamline operations and improve competitiveness across Amazon’s grocery businesses.
The changes also include a new leadership team tasked with unifying operations across all grocery banners, a process that began roughly two years ago as Amazon sought to consolidate its food retail offerings.