How Whole Foods has changed in the five years since Amazon took over

Five years ago, Amazon closed its $13.7 billion purchase of Whole Foods, by far the biggest acquisition ever for the e-commerce and cloud computing giant. Since then, Amazon has made a lot of changes to the specialty grocer, from lowering prices to embedding checkout technology in its 500-plus U.S. stores.

Amazon has opened 60 new locations, including one “dark store” entirely devoted to filling online orders. Yet Whole Foods still controls just over 1% of the grocery market, according to research firm Numerator, compared with Walmart’s 19% and Kroger’s 9%.

Next week, Whole Foods gets a new CEO for the first time since its founding in 1980. Operating chief Jason Buechel steps into the lead role on Sept. 1, succeeding colorful, polarizing co-founder John Mackey, who was once described as a “right-wing hippie.”

“When you have the kind of culture clash that I imagined John Mackey and Amazon had, it’s really impressive that John stayed around in a leadership position as long as he did,” said Jason Goldberg, chief commerce strategy officer at advertising firm Publicis. “It surprised me.”

Buechel takes over at a pivotal time for Amazon, which is jumping deeper into the world of in-person retail, with a focus on groceries. Revenue at physical stores climbed 12% in the second quarter, while online sales dropped. That marks a change from the prior few years, when Amazon’s physical stores lagged the overall retail business. Outside of the food business, Amazon recently shut 68 stores, including all Amazon Books, 4-star and Pop Up shops.

Here are some of the key differences in the Whole Foods of today from the company that Amazon acquired in 2017.

On the corporate side, Amazon centralized some operations, moving them from individual stores to Whole Foods’ Austin, Texas, headquarters. But it hasn’t become a conventional supermarket like some predicted. Whole Foods says rather than swapping out regional suppliers for bigger names, the company has added 3,000 local brands in the past five years, a 30% increase since before the Amazon deal. 

Each region has teams of full-time “foragers,” who look for new local products. Whole Foods says the model gives flexibility for smaller brands to remain in a few stores instead of having to supply products companywide. Amazon uses its data tools to help determine what brands get sold in what stores.

“Going into a Cupertino store is a very different experience, versus walking into a Los Altos or Los Gatos store in the same Northern California region,” said Guru Hariharan, a former Amazon software development manager who now runs e-commerce management company CommerceIQ. “They’re probably doing a better job because of the personalization algorithms.”

There’s also a new accelerator program for local producers to earn a spot on the shelves of local stores, and certified training programs to turn hundreds of Whole Foods workers into accredited cheesemongers and butchers. While some of the hot food…