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Bloomberg has a piece suggesting that if Kroger, as has been widely speculated, indeed is considering various sorts of alliances or deals with the likes of Alibaba, Boxed, and Overstock, then it is “making the right call.”

The reason? Well, the basic premise of the analysis is that Kroger’s existing turnaround plan - dubbed Kroger Restock - may not be enough for the current competitive climate.

“Initiatives such as greater personalization and localized merchandise selection are fine ideas,” the analysis says. “But they are the kind of plans that will merely allow Kroger to keep up with what rivals are already doing, rather than sprint ahead of them. And even though Inc. hasn't done much yet with its acquisition of Whole Foods Market, that tie-up was a wake-up call to grocers: A sector that has largely been shielded from the threat of e-commerce is going to start feeling some pain.”

Kroger, the story says, “should be trying to find an e-commerce deal -- be it with Boxed or Overstock or another target -- that does for its grocery empire what the $3.3 billion acquisition of did for Wal-Mart Stores Inc … the real value of that tie-up has been that it was a turning point for Walmart's entire digital operation. Jet founder Marc Lore has pushed the whole apparatus to move faster and more creatively, and that has helped fuel Walmart's recent hot streak.”

The Bloomberg piece suggests that Boxed is the better acquisition target for Kroger: “Boxed has grown explosively since it launched in 2013 and it has been on the leading edge of fulfillment-center innovation. Plus, both Boxed and Kroger heavily focus on consumer-packaged goods, so it's easy to see how they could help each other. Boxed founder Chieh Huang brings the innovative thinking and startup-style hustle, while Kroger has scale. And buying Boxed would help keep it out of the hands of Amazon, another suitor which also has held takeover discussions with the company.”
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