Online shopping hits broader retail world

Dhaka,  Tue,  22 August 2017
Published : 17 Jun 2017, 14:21:14
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Online shopping hits broader retail world

Online shopping hits broader retail world
Bricks-and-mortar retailers had a bruising day after Amazon’s swoop on Whole Foods sparked fears of heightened competition across the supermarket industry, according to a global media report Saturday. 

Kroger, one of the largest US supermarkets and general retailers, led declines in the New York morning, with a 12.5 per cent drop to $21.48. Discount chain Target fell 9.6 per cent to $50.14 and wholesale warehouse Costco dropped 6.4 per cent to $168.5. 

Walgreens was down 6.1 per cent to $77.52 while its fellow pharmacy chain CVS Health moved 5.2 per cent lower to $75.92.

One of Amazon’s largest rivals, Walmart, also suffered even as it announced a further push into online retailing with a $310m deal for Bonobos, a men’s apparel retailer, for $310m in cash. The acquisition, expected to close towards the end of the second quarter or into the third, follows the purchase of online retailer Jet.com. 

Walmart had tumbled 6.4 per cent to $73.89 by midday. 

The Whole Foods deal “put grocers on notice”, said Mickey Chadha, analyst at Moody’s. 

European supermarkets also took a hit, even though Whole Foods lacks a continental presence and has only a modest footprint in the UK. 

The broader retail world has come under pressure from the rise of online shopping, with many groups struggling to adjust to the shift. Grocers and supermarkets have been relatively insulated from this trend, but Amazon’s foray shows the potential for ecommerce to break through in food.

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