Amazon buying Whole Foods: How will it affect beer?

With today’s announcement that it is buying Whole Foods Inc., Amazon is positioned to shake up the U.S. grocery industry and how food and beverages – including beer – are sold.

The acquisition of Whole Foods gives Amazon a significant physical footprint (Whole Foods has 440 stores in 42 states and the District of Columbia, according to its latest quarterly report). This expanded presence could enable Amazon to expand home delivery of groceries.

“It gives them a distribution footprint to deliver goods in a short time frame,” noted Tim Ghriskey, chief investment officer for Solaris Asset Management.

Amazon has been looking at ways to crack in to grocery for years, including with AmazonFresh.

Analysts and industry observers expect the move to be disruptive, with “Will brick and mortar retail ever be the same again?” being a typical headline.

While it’s too early to predict how Amazon will compete in different segments, it is worth noting that Amazon has shown a strong interest in home delivery of beer.

For example, the USA Today reported earlier this year that Amazon was piloting a program for quick delivery of beer in three cities:

Amazon Prime customers who have an Alexa-powered device, such as the Echo speaker, can order beer, wine and spirits in Seattle, and beer and wine in Columbus and Cincinnati. Amazon will deliver the alcohol within two hours.

And MillerCoors earlier this year announced a “Miller Lite On-Demand” initiative that leveraged Amazon Alexa and the Amazon Dash Button.

Beer is very different from other consumer categories that have been disrupted by Amazon. But there’s little doubt that the industry will feel the impact of the largest online retailer expanding into grocery.