Walmart Brings Added Competition To The Grocer Space

The competitive landscape within the grocery store market continues to mount with Wal-Mart Stores Inc WMT's launch of a private label brand for its Jet.com property, the New York Post reported.

Jet.com will soon introduce dozens of food and household items, likely as a counter to not only Amazon.com, Inc. AMZN's acquisition of Whole Foods, but the rapid expansion of German discount chains Aldi and Lidl.

The private label brands that Jet.com will introduce are expected to be "better quality than many of the national name brands," retail consultant Burt Flickinger told the Post. Initially, the products will exclusively launch on Jet.com for one year and will likely make their way to Walmart.com afterwards. The products will eventually be sold in-store. 

Other grocery chains and food giants are surprisingly embracing Jet.com's new product line even though it's a competitor because it "tempers Amazon's leverage," the Post added.

Perhaps the news could also be welcomed by grocery store investors, as shares have been hard hit as of late. For example, Kroger Co KR's stock is down more than 13 percent over the past three months and around 30 percent since the Amazon-Whole Foods tie-up.
"The branded vendors are privately telling us that they are relieved about the Jet.com division becoming a big private label seller," Flickinger said. "They see Jet.com as the best opportunity to slow Amazon's march toward making unreasonable demands in its procurement."

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