Last week, analysts at Barclays issued a tough-love-style research note on the largest U.S. membership-only warehouse club, Costco Wholesale Corp. (COST).

As shares of the Issaquah, Wash.-based retailer have slid about 15% since ecommerce giant Inc.’s (AMZN) proposed acquisition of organic food retailer Whole Foods Market Inc. (WFM) was announced last month, Barclays analyst Karen Short says it’s time for the budget retailer to convince investors that it has a viable strategy to fight of the Seattle-based tech and retail powerhouse. (See also: Costco, Kroger, Wal-Mart Feel Pain of Amazon Deal.)

Warehouse Club Is ‘Best in Class’

While Short wrote that the investment firm viewed Costco as “best in class,” she suggests that investors have “bigger and longer-term concerns” as the food industry rapidly transitions to the world of online ordering and delivery services.

In the open letter to Costco, Short wrote, “We believe you can offer substantially more than AMZN for WFM and still have it be accretive.”

“Investors are more concerned with how the Amazon/Whole Foods acquisition—announced on June 16th—will impact your business model 12 months from now than your ability to generate strong results for the next four quarters,” wrote Short, indicating that the retailer should “seriously contemplate” a counterbid for Whole Foods.

Any Other Ideas?

Among a handful of other less drastic solutions suggested by Barclays included a partnership with U.K. delivery service platform Ocado and an acceleration of Costco’s non-grocery ecommerce efforts. “If this means hiring an external army of Silicon Valley techies—then so be it,” read the research note.

Last week analysts at BMO downgraded COST to market perform on “investor hyper sensitivity in an Amazon-fear dominated market.”

Trading down 0.4% on Monday at $153 per share, COST reflects a 3.2% decline over the most recent 12-month-period and a 0.6% loss in value year-to-date (YTD). (See also: Costco Sinks as Amazon Fears ‘Overshadow’ Results.)

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