Fresh Direct Case Study

Wendi Kelley

FreshDirect | www.freshdirect.com | Online Grocery Shopping and Delivery

BACKGROUND / HISTORY

(Dess, Lumpkin, Eisner, & McNamara, 2012)FreshDirect is a privately held company that offers online grocery shopping and delivery service in New York, New Jersey, and surrounding areas covering 300 zip codes. This grocery retailer is based in Long Island City. The company was co-founded in 1999, but launched in 2001 by Jason Ackerman and Joseph Fedele. Jason Ackerman currently holds the position of Chief Executive Officer (Company Overview of FreshDirect, LLC, 2012). In a 2010 article from Daily Finance, Rick Braddock, who was the CEO at the time said, “ The company has grown at an accelerated rate compared to 2009, when it generated more than $250 million in revenue” (Cohan, 2010). Another milestone was just recent this past May when FreshDirect expanded its service area to the Bronx and the USDA approved a test program that will allow the company to serve a sampling of food stamp users (Johnston, 2012). Total Profit and Loss for this company is not readily available to the general public since it is a privately held company.

In the online grocery service industry, FreshDirect seems to be one of the highest rated with lower delivery rates than its competitors. Their minimum delivery order and delivery charges, and all around product pricing, was lower than other online grocery services (Dess, Lumpkin, Eisner, & McNamara, 2012). FreshDirect buy straight from suppliers and cut out the middleman so they are able to extend their savings to their customers.

SWOT ANALYSIS

Strengths Weakness

No Cost for retail space High turnover of CEOs

Good manufacturing software Private investors

Expert Employees Ability to distinguish organic goods

Direct relationships with growers & producers Unionization of employees

Location of processing facility Poor designed website

Opportunities Threats

Territory Expansion Limited number of packaged...