Case Analysis - Grocery

Grocery Checkout Inc.

Define the Issue

Nathan Felder, co-founder and CEO of Grocery Checkout Inc., an online grocery delivery service, is pressured by his investors for faster growth of the business. Felder must determine operationally how this may be feasible. Given a few options that will be mentioned later, he must make sure his final decision is in-line with the long-term strategic plan. Managerially, there must be a viable plan that will succeed given the current resources and capabilities of the company.

Analyzing the Case Data

Internal - VRINE

GCO creates value through its services. It provides timely convenience to its customers. It’s main customer base is students (aged 18 to 24) from the University of Western Ontario. Felder found that these students usually did not have the time to physically go out to do their grocery, and being able to do this online, added value to the service provided. The service that GCO provides also demonstrates rarity. The only other major online grocery competitor was in the Greater Toronto Area. Therefore by GCO operating in the London market, one can conclude that there is rarity there. The only competitors that are closest to the university are Loblaws and Valu-Mart, both of which did not supply an online service like GCO.

Next there is the issue of imitation and substitution. The online grocery service was an idea that was fairly new and not many companies took part in. In London specifically, there were both large and small competitors who could potentially get into this market. With the steady success that GCO has been experiencing, it could spark motivation for other companies to develop the same service in order to expand and gain market share. Therefore GCO is easily imitated in a general sense, especially if it is from a large competitor who has the money and resources. Even from the point of view of a smaller competitor, this is still viable because GCO itself started from a group of university...