Whole Foods Market, Inc. Business Analysis

Management accounting is used in many types of businesses. Retail operations depend on management accounting very heavily in order to make sound business decisions and improve their position in the marketplace. One of the biggest retailers in the world, Amazon.com, Inc., has relied on management accounting for decision making in order to strengthen their hold on the market. Their recent acquisition of Whole Foods Market, Inc. is a big step into the retail grocery space. Amazon.com has tried to break into the online retail grocery business before and were met with mixed results. People were not buying their groceries online enough to meet Amazons goals. The online grocery market is small and one of the biggest issues was perishable food. They decided to acquire an established retail grocery chain, Whole Foods Market, in order to enter into the market spot. Amazon outweighed the costs and benefits …show more content…
Whole Foods Market sold all these products already. Amazon’s goals are to incorporate their Amazon Prime membership as a replacement to the Whole Foods loyalty program. Over time, they want to decrease the cost of products in general. One of the reasons Whole Foods was struggling was because of high prices that would price out many people in the lower income brackets. Amazon plans to reduce prices in order to capitalize on a broader income range. Amazon has shown many ways of utilizing management accounting. They are managing their resources and acquiring an established retail grocery chain instead of building up their own. They identified the trend of people eating healthier increasing. They understood when one area wasn’t working in their online grocery market and have pivoted into the retail grocery market. They are incorporating their online part of the business with the brick and mortar stores in order to reach a wider