...online grocery store industry. BACKGROUND FreshDirect was found in 1999 by Jason Ackerman, Steve Druckman and Joe Fedele as an online alternative to traditional grocery stores. The company specializes in delivering a variety of over 3,000 items such as fruits, vegetables, seafood, prepared entrees and sides, coffee, meat products, deli and cheese products, and bakery items (Goldberg, 2010). The company provides same day and next day delivery to over 600,000 customers in New York City neighborhoods in Manhattan, Brooklyn, Riverdale, Queens, Staten Island, Connecticut, Long Island, New Jersey, and Westchester County (Bruno, 2010). FreshDirect solidified its market position by purchasing directly from farmers and passed the low price to customers within seven days to guarantee freshness; therefore, the company was able to deliver food to customers’ door for 25% less than its competitors. Former CEO, Rick Braddock, used innovative ecommerce technology to give the company a competitive advantage (Hu, 2012). FreshDirect struggled to turn a profit, the U.S. Immigration and Customs Enforcement audited the company concluded 15% of the employees were not eligible to work in the U.S (Bruder, 2010). The company also experienced other growing pains with a revolving door of CEO’s; the current CEO, Jason Ackerman, is the fifth CEO in 12 years (Fickenscher, 2012). Under the helm of Ackerman, FreshDirect is positioned to be a success. FreshDirect is privately held company; therefore, financial...
Words: 1859 - Pages: 8
...Summary FreshDirect is a mobile grocer based in Queens, New York that delivers fresh produce, meat, dairy, and other food straight to residences within the state and surrounding areas. To help customers who find grocery shopping a chore, its greatest appeal is that the system allows customers to order food online instead of traveling to a physical store. All of their locations receive their food from one 300,000 square-foot production center, which means FreshDirect does not carry the burden of paying for retail space. Their mission is to buy locally as much as possible, so customers know their ingredients are fresh. As an online delivery grocer, the website is main artery of the whole operation. This is where customers can customize their meat cuts, review in-season and out-of-season produce, choose their delivery time, and pay for their order. By eliminating the middleman, customers can directly order produce, meat, seafood, baked goods, and coffees that are customized to their specifications. Online grocers have become increasingly popular in metropolitan areas during the last decade. In 2010, FreshDirect’s revenues accumulated to over $250 million, while total online grocery shopping sales were estimated to be about $8.4 billion. FreshDirect still faces numerous challenges like the rising cost of fuel, pressure from environmental groups to be more eco-friendly, and a large accumulation of traffic violations when trucks double-parked during deliveries. The company continues...
Words: 2853 - Pages: 12
...EXECUTIVE SUMMARY: FreshDirect is part of this online supermarket chain that has proven to be disappointing and costly for some organisations that have entered the market. However, FreshDirect was launched in July 2001 with the view that consumers were after fresh products, at low prices, that could be delivered straight to there doors at convenient times. They have proven to the industry that their strategies and philosophy’s have led to success and consumer based growth within the industry. The analysis of the organisations internal environment through such tools as the value chain and the resource based analysis, has demonstrated some areas where they create value and more importantly, a competitive advantage. It creates its value through certain primary activities like their operations, marketing and sales, outbound logistics and its services. Additionally, they create a competitive advantage through such resources as financial and physical resources and also some intangible resources like the knowledge and skills of the human capital. The analysis tools that are used to examine the external environment of FreshDirect are the theories of the general environment and the five forces model identified by Michael E Porter. These tools analyse the external influences on the industry and analyse the organisations competitive environment. This is a great tool to establish where exactly FreshDirect fit in the ever changing industry. FreshDirect’s business – level strategy...
Words: 2618 - Pages: 11
...Summary: FreshDirect was launched in July 2001 by Joseph Fedele and Jason Ackerman. FreshDirect is a New York City based online grocery store with a state of the art production center, top-notch personnel, leading edge manufacturing software, the highest standard of cleanliness, health & safety, and an informative and user-friendly website. System efficiencies include: a cost-effective operational design; no middleman; a central production and distribution location; well designed order and delivery protocols; and a policy of no slotting allowances. These system characteristics enable FreshDirect to maintain a high product quality while keeping product prices low, therefore their promise to grocery shoppers of “higher quality at lower prices.” The website offers a broad selection of products along with information about the food and how it is sold. Products can be compared on taste, price, usage and nutritional information. Custom cuts and seasonings of meat can be ordered. Delivery options include direct to the home in New York City, or office and train parking lot access in the suburbs. The online segment of the grocery industry is a small percentage of the industry total. Despite a large potential target audience, the on-line segment has been slow to catch on. FreshDirect’s competition comes from traditional brick-and-mortar grocery chains and a handful of other on-line grocers in New York City. The challenge is to compete on price while covering the cost of selecting items...
Words: 2812 - Pages: 12
...hemorrhaging money and alienating customers because its basic business model was not working. THE BACKGROUND When FreshDirect was founded in 1999 — in those euphoric days before the Internet bubble burst — the idea of an online grocer in New York City seemed promising. The company would not only sell just farm-fresh food, it would sell time and convenience, too. FreshDirect started building its 300,000-square-foot headquarters and packing plant in 2000 in the Long Island City section of Queens and made its first deliveries two years later. But little went as planned. “We broke too many eggs,” said Richard S. Braddock, who would become the company’s chairman in 2005 and its chief executive in 2008. “We showed up with thawed ice cream. We bruised the produce. We delivered late. We missed boxes. We didn’t remediate your service issues.” During FreshDirect’s formative years, the only thing that kept the company alive was its ability to churn through customers. A series of incentives for first-time buyers — including a $50 discount on orders of $100 or more — kept attracting newcomers, but most of them dropped the service after their discounts ran out. Back then, according to Mr. Braddock, about 85 percent of the company’s customers placed just one or two orders before giving up on the site. Revenue was on the rise, but profits did not follow. Inevitably, FreshDirect started running out of cash. Against that bleak backdrop, a crisis struck at the end of 2007. Immigration...
Words: 1226 - Pages: 5
...Monwakeh Keiyegar COMPANY NAME/WEBSITE/INDUSTRY The name of the company is FreshDirect and it is in the retail grocery industry, the company website where people go to buy products from is freshdirect.com BACKGROUND/HISTORY The company in the case study is FreshDirect. FreshDirect was founded in July 2001 by Jason Ackerman and Joseph Fedele. FreshDirect is an online base grocery store in New York that provide high quality fresh foods and grocery items at cheap price and delivers to more than 250,000 customers in the New York and New Jersey area. The FreshDirect plan to win in the market is by eliminating the middleman SWOT ANAYSIS | INTERNAL ENTERNAL | | Strengths |Opportunities | |FreshDirect have strong financial assets. |Reputed brand name and its customers are highly trusted on| | |FreshDirect products. | |Advance food technology software system. | | | |Delivery of un-perishable products along with its popular | |FreshDirect had refrigerated loaded trucks that keep |perishable products. | |their foods fresh....
Words: 510 - Pages: 3
...Case 19: FreshDirect Is It Really Fresh?* With a bold promise on its website entry page, FreshDirect claimed, “Our food is fresh, our customers are spoiled…. Order on the web today and get next-day delivery of the best food at the best price, exactly the way you want it, with 100 percent satisfaction guaranteed.”1 However, recently many consumers have questioned the freshness of the food delivered by FreshDirect. Since online shopping does not give the chance for customers to feel and choose the products themselves, they must rely completely on FreshDirect to select the food for them. This notion has not appealed to some customers. Operating out of its production center in Long Island City, Queens, FreshDirect offers online grocery shopping and delivery service to more than 300 zip codes in Manhattan, Queens, Brooklyn, Nassau County, Riverdale, Westchester, select areas of Staten Island, New Jersey, and parts of Connecticut. FreshDirect also offers pickup service at its Long Island City facility, as well as corporate service to selected delivery zones in Manhattan and summer delivery service to the Hamptons on Long Island. When it was launched in July 2001 by Joseph Fedele and Jason Ackerman, FreshDirect pronounced to the New York area that it was “the new way to shop for food.” This was a bold statement given that the previous decade had witnessed the demise of numerous other online grocery ventures. However, the creators of FreshDirect were confident in the success...
Words: 6967 - Pages: 28
...FreshDirect Case Study COMPANY NAME/WEBSITE/INDUSTRY FreshDirect is an online grocer providing high quality fresh foods, popular grocery and household items at incredible prices delivered to residences and office in New York City and the metropolitan area. Their website can be accessed at www.freshdirect.com. FreshDirect tailors cuisine, perishables and dishes for its clients by means of an assembling practice known as Just-In-Time lessening waste and enhancing quality and freshness. FreshDirect is prominent for its resource usage of local agriculture offering organic, natural nourishment supplying commodities the consumer would purchase in their local supermarket. BACKGROUND/HISTORY Founded in 1999 by Jason Ackerman and Joseph Fedele, they ascertained learning from failed attempts of other online grocers. Ackerman, who worked in finance, sought out Fedele, who worked at Fairway grocery. In a Bloomberg TV interview last year, Ackerman said, “[W]e really founded on two guiding principles. First was to rethink how we get product from the farm to a customer's table in a much more efficient way which lends itself to deliver better quality products at better prices. And second, because we know so much about our customers, is to use that information to deliver a much more personalized, better experience.” [ (Goldberg, 2010) ]. The Key Executives for FreshDirect, LLC are Mr. Jason Ackerman, Co-Founder and Mr. Steve Druckman, Chief Marketing Officer. The company...
Words: 1286 - Pages: 6
...11 Relationships | Capital Area Food Bank, Inc | -- | J. Brendan Ryan | 23 Relationships | The Interpublic Group of Companies, Inc. | 71 | View All Board Members Fresh Direct, LLC Executive Committees* Committee Name | Chairperson | Board Relationships | Members | There is no committee data available. | October 23, 2012 01:55 AM Eastern Daylight Time LONG ISLAND CITY, N.Y.--(BUSINESS WIRE)--FreshDirect makes history again today with the national launch of the first grocer payments application for the battery-powered Dynamics ePlate™ credit card device. The innovated offering lets consumers earn credits towards their groceries with every purchase. “Now consumers can gain credits towards quality fresh foods just by making their daily purchases.” When the FreshDirect experience™ application is selected on their ePlate device, a consumer will earn additional savings at FreshDirect, as they use their Dynamics ePlate™ credit card device for their everyday purchases. Consumers can sign up for a battery-powered Dynamics ePlate™ credit card device atwww.dynamicsinc.com/freshdirect “We’re thrilled to be teaming up with Dynamics Inc. to provide this...
Words: 1868 - Pages: 8
...COMPANY NAME/WEBSITE/INDUSTRY Fresh Direct / https://www.freshdirect.com/ Retail Grocery Industry BACKGROUND/HISTORY Based out of Long Island City, Queens, FreshDirect was launched in July 2001, by Joseph Fedele and Jason Ackerman. It offers online grocery shopping and delivery service to over 300 zip codes in the Manhattan, Queens, Brooklyn, and surrounding areas. At the time of launch, there had been numerous other online grocery ventures that had ultimately met their demise. What made Fresh Direct unique was that it could offer grocery shoppers: “higher quality at lower prices.” It was able to do so because it had no retail location, which meant there was no rent to pay for retail space. In order to provide its customers with highest quality of food, FreshDirect created a state-of-the-art production center that is staffed with expert personnel. Since its existence, FreshDirect has changed CEO’s seven times, with Jason Ackerman, one of the co-founders, as its current CEO. FreshDirect currently is a privately owned company is not mandated to share any of its financials to the public. However, in an interview by Ken Bruno of Forbes with former CEO Richard Braddock, Bruno stated, “the company increased revenue in 2009 by approximately $20 million up to an estimated $250 million and in 2010 has grown its customer base in the range of 20% to 25%” (June 2010). SWOT ANALYSIS STRENGTHS Large concentration of population Does not pay rent for retail facilities Able...
Words: 1496 - Pages: 6
...COMPANY NAME/WEBSITE/INDUSTRY FreshDirect/ Long Island City, Queens New York/ Food delivery Industry. BACKGROUND/HISTORY FreshDirect offers online grocery shopping and delivery service to more than three hundred zip codes in New York. Additionally they offer pick up service at one location in Long Island. The idea behind this company is to give the customers the freshest food possible by buying it straight from the grower, and then delivery it the next day after the customer’s order is placed. They specialize in delivering over 3,000 items including seafood, fruits, vegetables, coffee, meats and cheeses, and items from the bakery. This company was launched by Joseph Fidele and Jason Ackerman in 2001. Jason Ackerman is the company’s current CEO. Since they are a privately owned company profit information isn’t readily available but it is estimated that the company increased revenue in 2009 by $20 million and estimated $250 million in 2010. http://www.forbes.com/2010/06/29/freshdirect-online-grocery-braddock-cmo-network-grocery.html “Ackerman says FreshDirect now does 25,000 orders per week. Many customers are attracted by the $50 worth of free food that comes with a first order; others by prices that can be 10 to 15 percent lower than neighborhood stores. FreshDirect says it retains about half the customers who try the service, and that the company began turning a profit this January. “We make money doing this. Period. The end,” Ackerman says. “We’ve got lots of money in our...
Words: 1447 - Pages: 6
...Competitive Profile Matrix…………………………………………………………...pg 12 TASK THREE: STRATEGIC IMPLEMENTATION 13. Present Analysis………………………………………………………………………pg 13 14. Future Implementation………………………………………………………………..pg 14 15. Strategic Evaluation Framework……………………………………………………...pg 14 TASK ONE: STRATEGIC ANALYSIS 1. INTRODUCTION OF THE ORGANISATION FreshDirect is online grocers that delivers to residences and offices in the New York City metropolitan area. FreshDirect also offers next day delivery to the majority of Manhattan and parts of Brooklyn, Queens, The Bronx, Staten Island, Nassau County, Westchester County, Hoboken, New Jersey and Jersey City, New Jersey. The corporation was founded by Joe Fedele and Jason Ackerman, a former venture banker who focused in the grocery industry. FreshDirect custom prepares groceries and meals for its consumers, a developed practice called Just in Time that reduces ravage and improves excellence and originality. Introduced to the New York market in 2002, FreshDirect grow popular for its expediency, fresh food and lesser prices than many Manhattan supermarkets. FreshDirect is...
Words: 3465 - Pages: 14
...Jennifer Kunkel COMPANY NAME/WEBSITE/INDUSTRY FreshDirect / http://www.freshdirect.com/site_access/site_access.jsp / grocery industry BACKGROUND/HISTORY FreshDirect was created in July 2001 by cofounder and former chief executive officer Joseph Fedele, who was able to bring plenty of experience in New York City’s food industry to the company. Vice Chairman and Chief Financial Officer Jason Ackerman was an investment banker with Donaldson Lufkin & Jenrette, where he specialized in supermarket mergers and acquisitions and gained him exposure into the grocery industry. Fedele and Ackerman had decided to open their own chain of fresh-food stores, but decided to pursue an option that allowed them to use online shopping and central distribution to deliver their products to consumers. The idea behind the company was to take products that you typically get from a grocery store and deliver them to the doors of their customers. After several changes to CEO, Jason Ackerman is currently holding the position. (Dess, c125) SWOT ANALYSIS Strengths * Financial backing from several private sources, with a small contribution coming from the State of New York. * Outstanding customer service. * Door to door delivery. * Warehouses have multiple temperature zones to ensure freshness of different types of food. * Refrigerated trucks. Weaknesses * Only located within a certain mile radius of Manhattan, Queens, Brooklyn, Nassau County, Riverdale, Westchester, select...
Words: 903 - Pages: 4
...Case Study Report Outline and Grading Guide (150 points) COMPANY NAME/WEBSITE/INDUSTRY FreshDirect, Freshdirect.com, Food and Grocery BACKGROUND/HISTORY Fresh Direct is a company that allows you to order your food online and get next day delivery, their moto is “Our Food is fresh, our customers are spoiled….. Order on the web today and get next-day delivery of the best food at the best price, exactly the way you want it with 100% satisfaction guaranteed.” The primary business is to allow customers to order their food online and avoid going to a grocery store they can buy anything they want online and you can have it delivered to you house. Key players would be the people who launched the business in 2001 Joseph Fedele and Jason Ackerman. Many companies have fallen online with the grocery service and they boldly stated they were the “greatest way to shop for food” this again was a bold statement in many of these chains have fallen. Company launched in 2001 and by 2011 you had to have a order of 30$ with a delivery fee associated with it. The company started to fall apart when the competition start to raise in the industry that is when they started offering local grown and organic but their were some fields they just couldn’t compete with. 23–30 Borden Avenue Long Island City, New York 11101 U.S.A. Telephone: (718) 928-1000 Fax: (718) 433-0648 Web site: http://www.freshdirect.com Private Company Founded: 1999 Sales: $200 million (2005 est.) NAIC: 311991 Perishable...
Words: 1037 - Pages: 5
...Online grocer utilizes BI to deliver customer service promise May 4, 2011 According to STORES.com, FreshDirect, a New York-based online grocery delivery company, uses business intelligence (BI) strategies and technologies to help it carry out its satisfaction guarantees and customer service promises. “First and foremost, at FreshDirect we are committed to delivering the highest quality, freshest foods in New York City and the tri-state [New York, New Jersey, Connecticut] area,” said Brandon Arbiter, business intelligence manager for Fresh Direct LLC. “That’s actually a guarantee we have for our customers, and we back that up with the guarantee that if you’re not totally satisfied, our customer service team will make it right.” FreshDirect buys directly from sources such as local farms to distribute fresh foods. The products typically reach customers about a week earlier then they would if sent through chain grocery store channels. The company is adamant about practicing excellent customer service. “This guarantee has actually turned into a very rich source of data,” Arbiter said. “Our customers tell us exactly how we’re doing and help us to find better ways to meet their expectations. We take that feedback and organize it into various reports that are customized for every department and every level of management.” FreshDirect began using SAP AG’s BusinessObjects portfolio in 2010 for operations and insights into performance metrics for product quality,...
Words: 349 - Pages: 2
