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With the Whole Foods-Amazon merge people were told they would see a decrease in many
product costs. It seems though that although there were some initial decreases to products the
market shift on goods has made it difficult for the company to follow through on many more
decreased pricings. This could cause customer dissatisfaction with what seems like Whole Foods
going back on their word to consumers to provide lower pricing.
Church & Dwight recently announced it has increased prices for about one-third of its products,
including Arm & Hammer cat litter, baking soda and some of its cleaning products. The price
increase, according to the report, is to offset higher commodity costs and boost profits. That rise
in cost stems from the raise in other major food giants’ need to increase food prices this year
creating a ripple on the supply chain. The pressures of major brands also extend to other
suppliers, including those filling smaller niches, such as organic groceries. (Anderson, 2019)
This problem Whole Foods is having can be illustrated with Graph D. Graph D supply curve
shifts inward showing the suppliers can bring fewer products to market at higher prices for all
possible quantities. This causes an increase in price, and demanders are willing to buy a lesser
quantity demanded. In this case grocers are left with passing along the increase to their
customers and protecting their own profits. With Whole Foods being a premium grocery store
the increased prices for them to shelve goods may hurt their business more since they are already
at a higher value and price. This may push consumers to look elsewhere for lower price options.
Anderson, G. (2019, February 20). Can Amazon's Whole Foods Afford Price Hikes? Retrieved
from
https://www.forbes.com/sites/retailwire/2019/02/20/can-amazons-whole-foods-afford-price-
hikes/#1e88ef8f27bf
