Wal-Mart Stores Inc. (NYSE:WMT) is doing all it can as it tries to counter the threat posed by the Amazon.com, Inc. (NASDAQ:AMZN) proposed $13.7 billion takeover of Whole Foods Market, Inc. (NASDAQ:WFM). The acquisition is poised to give the e-commerce giant access to 465 retail locations posing a big threat to the nation’s largest retailer.
Walmart Defense
Reports indicate that Walmart has asked a good number of its suppliers and partners to desist from using Amazon Web Services. Snowflake Computing CEO, Bob Muglia says that one partner was asked to switch to Microsoft Azure cloud services if he wanted to continue accessing the retailer’s warehouse services.
Amazon has already confirmed that some of its clients have been bullied into switching their allegiances to other cloud services.
“Yes, we’ve heard that Walmart continues to try to bully their suppliers into not using AWS because they have an incorrect view that AWS is somehow supporting Amazon’s Retail business,” said Amazon in a statement.
Walmart has denied the claims. The company’s spokeswoman says vendors can use a cloud service of their choice. However, an admission that the company cannot allow crucial information to be in a rival’s platform all but affirms the growing tensions between the two retailers.
Amazon vs. Walmart
Tensions between the two retailers may continue to grow especially on Amazon encroaching on a space that Walmart has controlled for years. The nation’s largest brick and mortar store is aware of the threat the e-commerce giant poses given its financial muscle and success.
Moody’s retail analyst Charles O’shea is of the opinion that Whole Foods acquisition won’t give Amazon an edge over Walmart. The analyst expects Walmart to remain the world’s largest retailer and grocer.
“We continue to believe that most US consumers will refrain from buying their groceries online,” Moody’s said. But, i]f online grocery delivery can ever reach scale, Walmart is the retailer that will benefit the most, as it has the most complete distribution network,” said Mr. O’shea.
Walmart stock was up by 0.93% in Wednesday’s trading session, to end the day at $76.24 a share.