BUSINESS PLAN FOR GROCERY 13
Businessplan for a grocery shopping and delivery service
1.0.0.Executive Summary2.0.0.Industry History  3.0.0.External Analysis 3.1.0.General Environmental Analysis 3.1.1.Demographic Segment 3.1.2.Economic Segment 3.1.3.Political/Legal Segment 3.1.4.Socio-Cultural Segment 3.1.5.Technological Segment
3.1.6.Global Segment 3.1.7.Summary of General Environment Analysis3.1.8.Driving Forces 3.2.0.Industry Analysis 3.2.1.Description of the Industry3.2.2.Industry Dominant Economic Features3.2.3.Market Size 3.2.4.Market Growth Rate €3.2.5.Industry Trends3.2.6.Five Forces Analysis
188.8.131.52.Threat of New Entrants184.108.40.206.Power of Suppliers 220.127.116.11.Power of Buyers18.104.22.168.Power of Substitutes22.214.171.124.Intensity of Rivalry3.2.7.Summary of Industry Analysis3.3.0.Competition Analysis 3.3.1.Industry Competitors 3.3.2.Rivals Anticipated Strategic Moves3.3.3.Summary of Competitive Analysis
Groceryshopping and delivery services will be offered to individuals whocannot conveniently grocery shop regardless of the reasons such asbusy schedules. Effective and timely manner of service delivery willbe made possible through placement of orders via online messages andphone calls. Grocery order placement facilitates timely delivery ofservices to customers. In some cases, customers may be required topay an interest fee of the grocery delivery, which will be useful inprofiting the company services. Lowery et al. (2014), argue thatspecial packages win more customers to a business. These packageswill target groups that the company hopes to win includingfamily-friendly, colleges, schools, health-enthused customers. 2.0.0.Industry History
Thecompany’s history will be created with time as it grows and becomesfunctional for many years. The business will be a multi-partnershipform of ownership.
Severalfactors such as the environment, demography, economy, politics, socioculture and technology are likely to influence the grocery deliveryservices.
3.1.0.General Environmental Analysis
Thecompany will be located at the heart of the US, (New York City) andwill offer services to all urban residents with the highestconcentration being neighboring cities. The highest concentrationwill be on households and families as well as institutions likecolleges, schools and health facilities that are dominant in thecity.
Womenof childbearing age with children mostly married or single mothers,college attendants, the catering departments of schools and hospitalsoffer a wide range of potential customers for this company. A largepercentage of household families comprise of educated, white orblue-collar employees who are in a position to order for thegroceries online or through calls. 3.1.2.Economic Segment
Knowinghow the relationship between customers and the economy changeovertime is imperative to the grocery business. The target populationcomprises of educated and hardworking individuals who are degreeholders or pursuing degrees in colleges and thus employed full timeor part time. They are able to meet their basic needs despite thetough economic global recession. To ensure that the company meets itsobjectives five economic out looks of consumers will be analyzedbefore starting the business. The confident spenders, fiscally fit,financial nesters, consumers facing challenges and economicallyindifferent. According to Experian marketing services (2014), theeconomic segmentation helps a company perceive the current and nearfuture financial outlook of the US economy.3.1.3.Political/Legal Segment
Whileconsidering the market segment a focus on the type of customers andpurchase makers who will be involved in improving profits is crucial.The company will be comfortable working with all customers butliberal purchase decision makers appeal to the company. They arecharacterized by the willingness to change including major changes aslong as the benefits can be seen, usually consider new productsrelated to the concept like grocery delivery services and wantofferings that use technological effectively. 3.1.4.Socio-Cultural Segment
TheUS is home to many socio cultures making picking out a particulargroup of people impossible. This diffusion of socio cultures isadvantageous to the grocery business as it makes it possible to meetthe needs of all Americans. Special groups like the vegetarians willalso be of interest to the company as they are likely to make moreorders. Communities that do not eat meat are as well good customersbut the vegetarians, societies, and food producers of vegetariandishes are a good target.
Accordingto Civic technologies (2009), embracing technology in grocerybusiness is the best thing for this company. Apart from offering fastand effective services for customers, it is also very convenient forbusy consumers. Working moms, schools and college customers are lesslikely to have time to walk to the grocery shop as compared togetting online and placing a delivery order. Since the target iseducated and literate customer’s the company will not have aproblem accessing delivery of placed orders on time. Customers whoare not online will have the opportunity to place orders via theirmobile phones emphasizing speed and reliability of service delivery.Through downloading the company’s free mobile app, the consumer canplace an order via the mobile app. The agent receives the order andcalls the customer for confirmation and the deliveryman goes to theconsumer’s address to deliver the product upon which payment isdone.3.1.6.Global Segment
Thecompany is looking forward to become a global grocery servicedelivery. After establishing the first business, strategic locationsacross major cities of the same business will be established. Themarketers are on the ground working to locate potential sites forestablishment of other grocery shopping delivery services. This willfacilitate the growth of a chain of stores first in all US dominantcities then to other countries and across the globe (IBM,2003).3.1.7.Summary of General Environment Analysis
Ananalysis of the general environment of the business is relevant tothe company as it gives an overview of success or threatopportunities. 3.1.8.Driving Forces
Withthe busy lifestyles and schedules to meet, people have becomeincreasingly engaged in their daily routine. This has as a resultmade it impossible for them to have time to go shop for basic needslike groceries, thus creating a need for grocery delivery services.With grocery delivery services, customers will have an importantcommodity at their doorstep without having to interfere with theirbusy schedules to go shop. The driving force of this business is tooffer convenient, effective and fast grocery delivery services tocustomers.
Theretail food industry in US has gone through massive changes in thepast decades. Part of the changes come up because of demographic,technological and lifestyle changes. One of the most notable changesis the growth of grocery deliver services, sale of food itemsconsumed at home to learning institutions and hospitals amongst otherchanges. According to the USDA, retail food expenditure in 1999 was$413.9 billion. As of 2001, the food sector had grown by a steady6.9% at a much faster rate from the previous year asserts Freddie etal. (2001). The demand for food and groceries particularly has notgrown steadily.
3.2.1.Description of the Industry
Thegrocery delivery services come at a time when buyers need theproducts yet have limited time to place orders or access them. Todeliver those services the industry needs a stable distributionnetwork. Grocery storage, streamlining, picking and packing groceryshould as well be possible.
3.2.2.Industry Dominant Economic Features
Vanac(2013) argues that grocery delivery services have grown as the demandfor organic, local unprocessed food is on the rise amongsttime-crunched customers. The dominant economic features of thegrocery industry are major as buying and selling groceries is a dailyroutine. The business of groceries contributes to the economicsignificantly, as income from the sale of groceries bring profits tothe company and the country’s economy. The grocery delivery willgenerate more income and offer employment opportunities.3.2.3.Market Size
Thereis a large market size for grocery delivery services. The middle agedis also educated and thus earn higher incomes making their ability topurchase or order for delivery services easier. Research revealedthat most grocery shoppers are attracted to faster, convenient andeffective services. With an effective network system, the grocerydelivery services will capture a large market.
3.2.4.Market Growth Rate
Almost80% households are families and thus require groceries for everymeal. 20% who consist of organizations and institutions also need thegroceries for food preparation. The urban regions and cities of USare more likely to demand for service delivery of groceries due totheir busy working schedules (RI, 2000). The groups, which are mostlyemployed middle-aged adults, are more likely to appreciate thegrocery delivery services as they can easily afford the services.3.2.5.Industry Trends
Sandeepand Ben in 2001 conducted a research on the US grocery store shoppersto investigate grocery-shopping behavior in 21 stores. Thisinvestigation was significant in identifying dominant economicfeatures of the grocery industry. The research revealed that keyshoppers were time pressed and thus seeking convenient services. Italso revealed that most shoppers were middle-aged women withchildren. These findings are useful as they focus on what the companyhopes to understand before getting into the service delivery.
3.2.6.Five Forces Analysis
126.96.36.199.Threat of New Entrants
Theeconomic recession and rising fuel costs is a threat to the company.The company requires our service delivery trucks to be fueled dailyfor delivery to take place. As the fuel costs keep escalating itbecomes hard to determine, what charges should be given to customersfor delivery of services to make profits and retaincustomers.188.8.131.52.Power of Suppliers
Foodlands and farmers from rural farms are our major suppliers and theirconstant supply of fresh groceries will place us at a competitiveedge.184.108.40.206.Power of Buyers
Ourtarget groups are well educated and working class individuals in needof the groceries but due to the busy schedules are unable to shopthus requiring the delivery services.220.127.116.11.Power of Substitutes
Oursubstitutes incase the suppliers fail are on the stand by to ensurethat the flow of grocery products never runs out.18.104.22.168.Intensity of Rivalry
Therival groups are well established and have lasted for years but withour strengths we will out do rival grocery shops.3.2.7.Summary of Industry Analysis
Grocerydelivery services fall under the service delivery industry. Efficacy,speed and quality of products in the service delivery industry aremajor aspects to fulfill family and household needs. The company’sstrengths and growth potential rely on factors like opportunities.The biggest opportunity is seeing high quality delivery of lifestylebundles that conveniently meets the needs of consumers throughdelivery of healthy groceries.
3.3.2.Rivals Anticipated Strategic Moves
Waltmart have established their brand name and won customer loyalty sincetheir establishment. Net grocery is inexpensive and service all 50states in US thus have great strategic moves. Peapod is affordableand targets local customers as well as high town customers offering alarge selection of product choices (Koller, 2001). This makes themreachable to all customers and offers a strategic advantage.Albertson’s is based on high quality delivery of services in aclean and customer friendly environment (Adner, 2002).3.3.3.Summary of Competitive Analysis
Customerloyalty, offering affordable delivery services, targeting wide rangesof customers and basing the delivery of services on high quality arevital elements when competing with other grocery shops.3.3.4.Key Success Factors
Thecompany will be unique unlike its competitors in several ways. Itwill offer special packages to target groups like family friendly,health- enthused and college focused customers providing a quickerand effective buying process for busy customers and fit well in themarket (Sell, 2000). Providing groceries from food lands will alsohelp us establish loyal customer bases who believe in the highquality provision of our services.
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