Amazon sees opening in baby formula industry shake-up
Amazon is deploying its lobbying power on America's baby formula crisis, seeing an opportunity to extend its reach into a $2 billion-a-year market.
Between April and June, the company's senior officials and in-house lobbyists held discussions about infant formula with lawmakers on Capitol Hill and officials from the federal government — the first time it's reported doing so, according to its most recent federal lobbying report. Amazon lobbyists also discussed online purchasing restrictions for federal nutrition benefits — which are used to buy at least half of the country's formula and billions of dollars worth of other groceries — with officials across the White House, FDA and other parts of the federal government, people familiar with those conversations say. Monument Advocacy, an outside firm representing Amazon, reported lobbying policymakers in the House, Senate and USDA on federal nutrition programs, as well.
Amazon's foray into formula lobbying shows how the e-commerce giant stands to benefit from the industry shake-up that the ongoing formula shortages have triggered, particularly the potential to draw a larger share of the billions in federal dollars that go to programs designed to help close to 50 million lower-income Americans. That could allow Amazon to compete more directly with Walmart.com, its biggest e-commerce rival. The two companies have spent years jockeying for more access to the federal nutrition programs, especially since Amazon acquired grocery store chain Whole Foods in 2017.
"Formula is the perfect product for Amazon," said Austin Frerick, deputy director of the Thurmond Arnold Project at Yale University, an antitrust law program. Among other things, he noted that it's non-perishable and valuable for attracting return customers — something the company, which currently controls just over 2 percent of the U.S. grocery market, could use. "I think they want a bigger food play and more of your food dollar," Frerick added. "Because that's what Walmart has. You can buy your DVDs, books and TVs on Amazon but on your deodorant, you'll go to Walmart."
(Score: 4, Insightful) by Runaway1956 on Tuesday August 09 2022, @10:21PM (4 children)
If Amazon gave a small damn about the crisis, they would build a baby formula plant of their own (not buy out or takeover an existing plant) and put that added capacity on the market. And, while doing so, they would ensure that they adhere to the strictest quality and purity standards. But, no, they're more interested in cornering a share in the existing market, adding nothing of value.
Abortion is the number one killed of children in the United States.
(Score: 2, Interesting) by Anonymous Coward on Tuesday August 09 2022, @10:28PM
Maybe they will. But it would take years and there might not be supply issues by then.
(Score: 2) by Opportunist on Wednesday August 10 2022, @07:14AM (2 children)
I'm more concerned that they also won't add any nutritional value beyond the bare minimum. Expect that formula to consist of a lot of cheap crap rather than what your baby needs.
(Score: 2, Interesting) by Runaway1956 on Wednesday August 10 2022, @11:04AM (1 child)
I feel that is already true of all "formulas". Mother's milk is indisputably the best thing for Baby, goat milk runs a distant second, cow's milk a distant third, then there's everything else from Similac to Coca Cola and beer.
Abortion is the number one killed of children in the United States.
(Score: 2) by Opportunist on Friday August 12 2022, @08:59AM
Don't knock giving kids beers 'til they get you out of a breathalizer test because no cop would think his breathalizer works when the 3 year old in your backseat blew a "legally drunk" level.
(Score: 4, Funny) by FatPhil on Tuesday August 09 2022, @10:31PM (2 children)
"Hold my beer..."
Great minds discuss ideas; average minds discuss events; small minds discuss people; the smallest discuss themselves
(Score: 2) by progo on Tuesday August 09 2022, @11:00PM (1 child)
Yeah, my gut reaction to this story was: Amazon probably caused the shortage.
(Score: 2) by TheGratefulNet on Wednesday August 10 2022, @12:21AM
stockroom workers need their bottles?
cranky delivery guys. maybe that's why the deliveries are going wrong, these days.
"It is now safe to switch off your computer."
(Score: 0) by Anonymous Coward on Wednesday August 10 2022, @12:13AM (1 child)
Gotta do something with their surplus Mellamine
(Score: 0) by Anonymous Coward on Thursday August 11 2022, @12:54AM
Wasn't that the same stuff a bunch of factories were putting in cat food because it would also inflate the protein analysis numbers?
(Score: 2, Interesting) by openlyretro on Wednesday August 10 2022, @01:41PM (2 children)
I find the second paragraph of this article written in a way as to obscure meaning. What exactly is meant by the following:
> ... the company’s senior officials and in-house lobbyists held discussions about infant formula with lawmakers on Capitol Hill and officials from the federal government ...
> Amazon lobbyists also discussed online purchasing restrictions for federal nutrition benefits
What is "held discussions" -- where does this happen, what is the context, what is the method?
What are "online purchasing restrictions for federal nutrition benefits"? Is that a euphemism for SNAP benefits? And if so, how does Amazon discuss that? What did they discuss? Are they trying to get the government to reduce the available SNAP allotment/quota in the available market of baby food?
The rest of the article is written well enough to be understood, it's just this second paragraph of marketing + business speak + euphemisms that sets off my BS meter. And me personally I'm missing so much context for how corporations get into discussions with governments (I assume I'm not alone here), that I would have liked the article to be a bit more forgiving and provide some background/transparency. It just raises more questions than it provides answers for.
(Score: 2) by stretch611 on Wednesday August 10 2022, @04:23PM (1 child)
No... not SNAP. (Also commonly referred to as food stamps.)
SNAP/food stamps actually allow the recipient to buy soft drinks, potato chips, and candy. (which have little and or questionable nutritional value.)
Alcohol, pet foods, and any hot or pre-prepared food are not eligible. (The latter actually can have nutritional value and still not be allowed.)
USDA SNAP FOOD GUIDELINES [usda.gov]
I would *guess* that any nutritional guidelines refer directly to baby formulas.
Now with 5 covid vaccine shots/boosters altering my DNA :P
(Score: 0) by Anonymous Coward on Thursday August 11 2022, @01:04AM
I question the "prepared food" restriction.
Although I am not homeless, I ponder that if I had no home, where would I prepare food?
On a bumfire?
It appears to me the "food truck" ( aka "roach coach" ) is probably the most efficient means of sustaining our homeless.