To combat the Amazon effect, Kroger is considering teaming up with Chinese e-commerce behemoth Alibaba.
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Senior executives from Kroger and Alibaba reportedly met in December to discuss a deal that would incorporate both e-commerce and brick-and-mortar sales, according to the New York Post.
Like many retailers, Kroger has suffered from the Amazon onslaught but was hit particularly hard after Amazon acquired upscale grocery chain Whole Foods Market. Kroger, along with Costco and Sprouts, watched shares dive in the days after Amazon announced the transaction and has struggled to recover ever since.
In November, the supermarket chain considered launching a new clothing line and engaged in conversations with online retailer Boxed.com early in the new year. The grocer has also been testing services such as curbside pickup initiatives to increase convenience for shoppers.
A Kroger-Alibaba merger could benefit both parties. The transaction would give China-based Alibaba a chance to increase its already massive reach by entering the American market and competing with Amazon on a global scale, while Kroger would be able to offer its customers more access to general merchandise. In addition, an Alibaba spokesman told CNN that talks about a partnership centered around boosting Kroger's presence in China.
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