Microsoft is already building a store to compete with Amazon, but its $500 million purchase of grocery giant Kroger means the tech giant is eyeing its own grocery store to get started.
Read More Amazon announced that it has hired the top managers of Kroger in the United States, Canada, and Mexico, as well as the head of its US retail operations, and will be headquartered in Omaha, Nebraska.
Kroger already operates more than 3,000 grocery stores in 12 countries, and its acquisition of Krogers US operations will mean that the grocery chain will also have the ability to offer products in some of the countries it has yet to open.
It is the second time Kroger has opened a grocery store in the US, following a $4.5 billion deal in 2012.
Amazon bought Kroger’s US operations for $1.5 trillion in cash and stock in January 2017.
Kroners US operations are in a period of transition, and are expected to focus more on organic groceries and produce.
Kroger says it will expand into the health food and organic markets in the future.
Kerri Schaffer, vice president of grocery operations, told Recode that Kroger is not focusing on any one single market, but instead looking to “enrich the experience of shoppers around the world”.
“We’ve seen the impact of the digital revolution, and we are building out our stores in new places,” she said.
“We want to be the grocery of the future, so we are going to focus on the US and Canadian markets and build out our own stores in Mexico and Canada.”
Krogers’ acquisition of the US operations was announced on Monday.
Krogers said in a statement that Krogers will be able to provide its customers with an “all-you-can-eat” experience across all of its locations, with access to a wide range of products.
“Krobin is excited to partner with Amazon to offer its customers a fresh, fresh experience in the grocery store.
Krobin’s goal is to give shoppers the best grocery experience on the planet,” said Kroger President and CEO Ken Krasner.
“This acquisition will enable Kroger to provide an unparalleled shopping experience for customers across all corners of the globe, including Amazon.”
Krasner said Krogers would retain the Kroger brand name.
“The Kroger name will be retained as the core and core brand for our grocery stores and online products,” he said.
“Our goal is for Kroger and Kroger stores to be as integrated as possible, so customers can easily shop from our online grocery store, Amazon Prime and Krobs online grocery, and other services,” Kroger said.
The Krogers acquisition will help Kroger boost its cash flow.
It will also boost its stock price.
Kroges stock rose 8.3% on Monday, closing at $39.99.
Kroenke’s stock rose 14.5%.