Freshdirect Analysis Report

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FreshDirect Analysis Report Taurus J. Parker DeVry University BUSN 412 Business Policy Instructor David Mozinski November 17, 2013 Case Study Report COMPANY NAME / WEBSITE / INDUSTRY FreshDirect/ BACKGROUND/HISTORY FreshDirect was founded in July 2001 by Joseph Fedele and Jason Ackerman. FreshDirect is an online grocery distribution that deliveries groceries to residential and office buildings in the New York area. This company current CEO is Jason Ackerman. This company claimed revenue of more than $250 million an increase of $20 million from last year and have grown its customer load by 5%. SWOT ANALYSIS STRENGTHS | WEAKNESS | OPPORTUNITIES | THREATS | The ability to help busy customers with their grocery needs. | Prices are higher than other supermarkets. | They can expand all across the world to open up new stores. | When other supermarkets offer online shopping. | Longest lasting online grocery chain. | They are only located in the New York area. | Can provide better advertising of the company to the potential customers. | When stores put the exact same items or products on sale. | ANALYSIS VIA PORTER’S FIVE FORCES MODEL The threat of new entrants in the online grocery business could lead to the company having to lower their prices and also, may have to lower their delivery fee just to compete with the newer companies that are trying to start out in the online business. They will also need to advance their technology within the company. The bargaining power of buyers allow for the customers that purchase loyalty from the company to pick and choose the products they need for the best price. This helps with the growth of the company; the company depends on customer loyalty to stay in business but this allows for the competitors to compete against one another. The bargaining power of suppliers hurts

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