Amazon acquisition of Whole Foods Market sends executives fleeing

By RetailFOXBusiness

Whole Foods executives fleeing after Amazon buyout: ‘Culture clash?’

Whole Foods is reportedly losing dozens of executives and leaders after Amazon purchased the organic grocery store chain in August.

Some Whole Foods executives have left the company after Amazon began integrating with the natural grocer, The Wall Street Journal reported Thursday.

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Since the tech giant acquired Whole Foods last August for about $13.5 billion, more than a dozen executives and senior managers have departed, The Journal reported, citing former employees and recruiters who are helping them find new jobs. People who have departed include leaders in the bakery, produce, sustainability and local-foods division. One former employee told the newspaper that “culturally it’s been a rough start.”

Some employees say Amazon hasn’t explained the details of its integration plan, according to The Journal, though executives at both companies painted a rosier picture in statements to the newspaper.

“We are off to a great start, and look forward to many years of future success together,” Steve Kessel, an Amazon senior vice president who oversees Whole Foods, said.

“We ... have maintained our distinctive culture while embracing many of Amazon’s leadership principles,” said Whole Foods CEO and co-founder John Mackey.

Since Amazon’s acquisition, at least two companies have been swallowed by the competition: Southeastern Grocers and Tops Markets.

Southeastern – the parent company of Winn-Dixie, BI-LO, Fresco y Mas and Harveys – said last week it plans to close about 100 underperforming stores and file for Chapter 11 bankruptcy by the end of March, after conducting a review of options to reduce its current debt.

“After careful consideration, we have chosen to voluntarily implement a court-supervised, prepackaged restructuring agreement … It is our goal to work through our financial restructuring as quickly and efficiently as possible, and we will emerge from this process likely within the next 90 days,” Southeastern said in a press release.

Tops Markets, a 56-year-old grocery chain with 169 supermarkets in upstate New York, northern Pennsylvania and Vermont, filed for bankruptcy in February, citing a highly competitive industry, including falling food prices. In court papers, Tops stated it lost $80 million on nearly $2.5 billion in revenue last year. The company’s acquisition by a private equity arm of Morgan Stanley in 2007 and ensuing transactions “saddled the company with an unsustainable amount of debt on its balance sheet,” Michael Buenzow, the head of the restructuring, said in the papers.

The company specifically mentioned “intense competition” from Amazon as a reason for some of its struggles.

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