Whole Foods is debuting lower prices in its stores Wednesday, and former Walmart U.S. President and CEO Bill Simon doesn't expect that the strategy will boost its sales.
Whole Foods, known for its organic selection and premium prices, last made major price cuts in November 2017 after being acquired by Amazon. Simon said the new lower prices on select items, announced earlier this week, likely show the retailer is working through the kinks of the competitive grocery market.
The recent price cuts are probably an "indication that [Amazon's strategy] hasn't worked the way they expected it to," Simon, a frequent critic of Amazon, told CNBC's "Squawk on the Street" on Wednesday.
In response to a request for comment on Simon's remarks, an Amazon spokesperson said: "That's simply not true. Price reductions at Whole Foods Market have been successful and feedback from customers has been overwhelmingly positive — in fact customers have already saved hundreds of millions of dollars through lower prices and Prime member deals."
Even with the announced average 20% off certain items, Whole Foods still has higher prices than other national grocery retailers. A recent analysis from Morgan Stanley revealed that a basket of items at Whole Foods costs $198, while it's $172 at a conventional grocery store and $157 at Kroger.