NEW YORK – No doubt much has been said about the bombshell news last week that Amazon is purchasing Whole Foods—from how the supermarket competition will fare to how “Just Walk Out” technology could revolutionize both the grocery and convenience store space. This week, the Wall Street Journal is putting a spotlight on the coveted “last mile” of retail, which the news source says is now the “hard part” of the logistics puzzle that Amazon must solve. (Read more about last-mile delivery in the February 2016 NACS Magazine cover story, “Going the Last Mile.”)

“It isn’t at all clear whether the king of e-commerce can do in fresh cabbages what it has done in CDs, books and just about everything else,” writes the Journal, adding that Amazon and Whole Foods combined still have a small fraction of Walmart’s share of groceries. “And Amazon faces a ‘last mile’ logistics problem of getting fresh food to doorsteps that it doesn’t with other goods,” add the news source.

Kent Knudson, a partner at consulting firm Bain & Co., told the Journal that fresh-food delivery “is going to be one of the hardest areas for them [Amazon] to get into…because of some of the physical challenges of getting food into people’s homes.”

While delivering fresh food to doorsteps may prove to be a hefty ladder to climb, the Journal suggests that Amazon is already poised to take the necessary steps. “Amazon, which has revolutionized the way people shop, is betting it can learn the business and solve at least part of the puzzle…It has cash to burn, deep experience in logistics and a record of relentlessly driving down supplier costs.”

But, no doubt fresh produce has proven difficult for e-commerce. According to Kantar Retail, selling food online is inherently complex, and in 2016, online shopping accounted for just 2% of the grocery sector’s sales. Knudson added that consumers want to see, touch and smell produce before buying, and making sure produce remains as fresh as possible during transit will be crucial for bringing more online shoppers into the fold. “It’s really the fresh categories such as produce and meat that are driving people’s decision of where to shop,” he told the Journal.

In terms of fresh-food delivery, the Journal writes that Amazon “has struggled for years with a logistical challenge” that is not inherent with books and electronics. “The entire fulfillment process is more complex and time consuming from the moment a ‘grocery’ shipment arrives” at a fulfillment center until it is shipped, which includes refrigeration and attention to factors such as “expiration dates, smell, and color, among others,” points out a Cowen & Co. report.

The e-commerce giant began selling dried groceries online several years ago, and has slowly built in fresh groceries in cities where its large warehouses are located “in part to avoid the need for refrigerated trucks.” Like other grocers, Amazon is also running up against the brick wall of consumers who are slow to adopt online shopping when it comes to fresh produce.

In April, John Mackey, co-founder of Whole Foods Market Inc., shared with the Journal how the specialty grocer has helped “reshape how Americans approach eating, transforming health food from a niche market into a booming retail sector attracting millions of urbanites, soccer moms and baby boomers.” However, same-store growth had been averaging 8%, with a profit decline by more than 5% and comparable-store sales dropping 2.5% in the fiscal year ending last September. And with Jana Partners LLC and several allies amassing an 8.8% stake in Whole Foods, the news source wrote that the sale of Whole Foods was likely. 

While much has and will continue to be said about Amazon’s latest acquisition, NACS Magazine talked about Amazon’s expansion into the same-day delivery grocery business with AmazonFresh in October 2013, asking the question whether the venture would disrupt the retail industry, or serve as merely a nuisance. What was true then remains true today:

“Amazon is committing itself to this space and CEO Jeff Bezos readily acknowledges that when the company decides to innovate, it has no qualms about disrupting the status quo.”