The Grocery Club, A Business Model

THE GROCERY CLUB
Economics and Design | Barnes Godrej Massing Rice Smith | Spring 2012
Shifts in Consumer Preferences
From Fast Food to Good Food
We can start to see a shift in consumer preference from

fast and cheap food to wholesome, quality whole foods.
Customers are looking for more ways to incorporate
healthy living, including cooking and preparing meals at
home.
2 | The Grocery Club | May 3 2012
The Problem
Cooking and Preparing Meals

at Home is Difficult
Takes time
Requires
planning
Requires
knowledge and
skill
Involves
multiple steps,
including
clean up
Value Proposition
For grocery customers who are dissatisfied with

the inconvenience of shopping, scheduling, and
preparing of meals...
...our solution is a weekly subscription based online
meal planning service that delivers pre-measured,
ready-to-cook meal ingredients right to their door.
Unlike current grocery order services, our service
lets customers focus on cooking and feasting,
not on the planning and ingredient preparation.
The Offering
Main Components
Subscription
based pricing of
groceries
Online meal
planning
Delivery of raw
ingredients
Post shopping
support
How it Works
1.)
Establish your subscription service
Number of people in household
12
Number of meals desired per week
Preferences
Preferred meals
Dietary Restrictions
Dietary Goals
Likes/Dislikes
Delivery Date
How it Works
1.)
Establish your subscription service
12
meals per week
1
$ 78
4+
156
234
312
How it Works
2.)
Plan your meals for the week

Suggested Meals and Meal Plan for Week
Make edits to meals, ingredients, prep
choices
Grocery Club sends

you an email 3
days prior to your
delivery
Add additional groceries and dry goods

outside of subscription
How it Works
3.)
Review, check out, and print
Print Meal Plan for the Week
Order locked in at noon day prior
How it Works
4.) Groceries
are hand-selected & picked first
How it Works
5.)
Groceries are delivered to TGC Member
How it Works
6.)
TGC Member is ready to prepare a meal
Ingredients prepped, sorted, and

labeled by meal and day
Grocery Club Chef Apprentice App

with cooking demos and tutorials
How it Works
7.)
Clean up is a breeze
Recyclable containers
Less prep equals less clean-up
How it Works
8.)
Premium services create additional value
Monthly visit from personal

chef or nutritionist
Additional revenue from add

on-services and groceries
Business Model Canvas
The Grocery Club

PARTNERS
Food Wholesalers and
Distributors
KEY RESOURCES
Delivery & Logistics
Ingredient Preparation
Other cooking related

partners (chefs, cookbook
publishers, etc)
Grocery Services
Content creation vendors

for web platform (cloudbased)
Content provider for a
Recipe Catalog
Scheduling and Planning

Web-based Software
KEY ACTIVITES
Delivery Drivers
Food Preparation
Web-based application
related activities
VALUE PROPOSITION
Grocery delivery service
Automatic weekly
replenishment of
groceries based on
subscription service
Portion control, dietary
restrictions and food
substitutions for more
healthful meals
Weekly meal scheduling
Track family preferences
for meals over time
Hand-selected produce
for Grocery Club
Members and produce
satisfaction guarantee
CUSTOMER
RELATIONSHIPS
Self-service via online
portal
Personal service via
home delivery and fresh
check guarantee
CUSTOMER SEGMENTS
Grocery shopping
customers who...
care about eating
healthy
want to minimize the
amount of time spent
preparing a meal
often eat out
CHANNELS
Online portal
Third party partner site
referrals
dont have the skills and

knowledge required to
prepare healthy meals at
home
Delivery/distribution
system
COSTS
Labor for food preparation and delivery
REVENUE STREAMS
Rent for Preparation space
Additional Grocery Sales
Fleet Leasing for Delivery
Advertising
Media Content development costs
Delivery Fees
Software development and IT support
Partner revenue for associated services
Subscription Fees
Relationships between Variables
The online portal supports GC customer experience

PARTNERS
KEY RESOURCES
Provides content for
Distributors
publishers, etc)
Content creation
vendors for web
platform (cloudbased)
Content provider
for a Recipe
Catalog
Grocery Services
Scheduling and
Planning Webbased Software
KEY ACTIVITES
Delivery Drivers
Food Preparation
related activities
VALUE PROPOSITION
Automatic weekly
replenishment of
groceries based on
healthful meals
for meals over time
for Grocery Club
Members and produce
CUSTOMER
RELATIONSHIPS
portal
check guarantee
CUSTOMER SEGMENTS
Grocery shopping
customers who...
care about eating
healthy
preparing a meal
often eat out
CHANNELS
Online portal
referrals

home
system
COSTS
REVENUE STREAMS
Advertising
Delivery Fees
Subscription Fees

PARTNERS
Distributors
publishers, etc)
Recipe Catalog
KEY RESOURCES
VALUE PROPOSITION
Which supports
Automatic weekly
Grocery Services
replenishment of
groceries based on
Scheduling and
Planning Webbased Software

KEY ACTIVITES
Delivery Drivers
Food Preparation
related activities
COSTS

healthful meals
Weekly meal
scheduling
Track family
preferences for
meals over time
for Grocery Club
Members and produce
CUSTOMER
RELATIONSHIPS
portal
check guarantee
CUSTOMER SEGMENTS
Grocery shopping
customers who...
care about eating
healthy
preparing a meal
often eat out
CHANNELS
Online portal
referrals

home
system
REVENUE STREAMS
Subscription Fees
Advertising
Delivery Fees

PARTNERS
Distributors
KEY RESOURCES

publishers, etc)
Grocery Services

Recipe Catalog

Web-based Software
KEY ACTIVITES
Delivery Drivers
Food Preparation
related activities
COSTS
VALUE PROPOSITION
Automatic weekly
replenishment of
groceries based on
CUSTOMER
RELATIONSHIPS
portal

check guarantee
which
customers
interact
through
healthful meals
Weekly meal
scheduling
Track family
preferences for
meals over time
for Grocery Club
Members and produce
CUSTOMER SEGMENTS
Grocery shopping
customers who...
care about eating
healthy
preparing a meal
often eat out
CHANNELS
Online portal
referrals

home
system
REVENUE STREAMS
Subscription Fees
Advertising
Delivery Fees

PARTNERS
Distributors
KEY RESOURCES

publishers, etc)
Grocery Services

Recipe Catalog

Web-based Software
KEY ACTIVITES
Delivery Drivers
Food Preparation
related activities
VALUE PROPOSITION
Automatic weekly
replenishment of
groceries based on
healthful meals
for meals over time
for Grocery Club
Members and produce
CUSTOMER
RELATIONSHIPS
portal
check guarantee
CHANNELS
Online portal
referrals
system
REVENUE STREAMS
Advertising
Grocery shopping
customers who...
care about eating
healthy

preparing a meal
which is supported through
often eat out
COSTS
CUSTOMER SEGMENTS
Subscription Fees
Delivery Fees

home

PARTNERS
Distributors
KEY RESOURCES

publishers, etc)
Grocery Services

Recipe Catalog

Web-based Software
KEY ACTIVITES
Delivery Drivers
Food Preparation
related activities
COSTS

VALUE PROPOSITION
Automatic weekly
replenishment of
groceries based on
healthful meals
for meals over time
for Grocery Club
Members and produce
CUSTOMER
RELATIONSHIPS
portal
check guarantee
Grocery shopping
customers who...
care about eating
healthy
preparing a meal
often eat out
CHANNELS
Online portal
referrals
system
REVENUE STREAMS
Subscription Fees
pays for
CUSTOMER SEGMENTS
Advertising
Delivery Fees

home

PARTNERS
Distributors
KEY RESOURCES

publishers, etc)
Grocery Services

Recipe Catalog

Web-based Software
KEY ACTIVITES
Delivery Drivers
Food Preparation
related activities
VALUE PROPOSITION
Automatic weekly
replenishment of
groceries based
on subscription
service
Portion
control, dietary
restrictions and
food substitutions
for more healthful
meals
CUSTOMER
RELATIONSHIPS
portal
drives and fresh
home delivery
check guarantee
CUSTOMER SEGMENTS
Grocery shopping
customers who...
care about eating
healthy
preparing a meal
often eat out
CHANNELS
Online portal
referrals

home
system
COSTS

for meals over time
for Grocery Club
Members and produce
REVENUE STREAMS
Subscription Fees
Advertising
Delivery Fees
The online portal

supports GC customer experience
&
PARTNERS
KEY RESOURCES
VALUE PROPOSITION
Food Wholesalers
and Distributors
Delivery &
Logistics

publishers, etc)
Ingredient
Preparation

Grocery Services

Recipe Catalog
KEY ACTIVITES
delivers
Delivery Drivers
Food Preparation
related activities
Automatic weekly
replenishment of
groceries based
on subscription
service
Portion control,
dietary restrictions
and food
substitutions for
more healthful
meals
CUSTOMER
RELATIONSHIPS
portal
check guarantee
CUSTOMER SEGMENTS
Grocery shopping
customers who...
care about eating
healthy
preparing a meal
often eat out
CHANNELS
Online portal
referrals

home
system
COSTS

for meals over time
for Grocery Club
Members and produce
REVENUE STREAMS
Subscription Fees
Advertising
Delivery Fees

PARTNERS
Distributors
publishers, etc)
Recipe Catalog
KEY RESOURCES
Grocery Services
Web-based Software
KEY ACTIVITES
Delivery Drivers
Food Preparation
related activities
VALUE PROPOSITION
Automatic weekly
replenishment of
groceries based
on subscription
service
Portion control,
dietary restrictions
and food
substitutions for
more healthful
meals
CUSTOMER
RELATIONSHIPS
portal
home
and
freshof
meets delivery
the unmet
needs
check guarantee
CUSTOMER SEGMENTS
Grocery shopping
customers who...
care about eating
healthy
preparing a meal
CHANNELS
often eat out
Online portal
dont have the skills

and knowledge
required to prepare
healthy meals at
home

referrals
system
COSTS

for meals over time
for Grocery Club
Members and produce
REVENUE STREAMS
Subscription Fees
Advertising
Delivery Fees

PARTNERS
Distributors
publishers, etc)
Recipe Catalog
KEY RESOURCES
Grocery Services
Web-based Software
KEY ACTIVITES
Delivery Drivers
Food Preparation
related activities
COSTS
VALUE PROPOSITION
Automatic weekly
replenishment of
groceries based on
healthful meals
for meals over time
for Grocery Club
Members and produce
CUSTOMER
RELATIONSHIPS
portal
check guarantee
CUSTOMER SEGMENTS
Grocery shopping
customers who...
care about eating
healthy
preparing a meal
CHANNELS
often eat out
Online portal
dont have the skills

and knowledge
required to prepare
healthy meals at
home

referrals
system
REVENUE STREAMS
Subscription Fees
generate revenue by

Advertising
Delivery Fees

PARTNERS
Distributors
publishers, etc)
Recipe Catalog
KEY RESOURCES
Grocery Services
Web-based Software
KEY ACTIVITES
Delivery Drivers
Food Preparation
related activities
VALUE PROPOSITION
Automatic weekly
replenishment of
groceries based on
healthful meals
for meals over time
for Grocery Club
Members and produce
COSTS


portal
check guarantee
CUSTOMER SEGMENTS
Grocery shopping
customers who...
care about eating
healthy
preparing a meal
often eat out
CHANNELS
Online portal
referrals

home
system
REVENUE STREAMS

CUSTOMER
RELATIONSHIPS
which pays for
Subscription Fees
Advertising
Delivery Fees
EZ DOES IT
MY FOOD IS LOVE
Food Embracer
Non-Grocery Shopper
True Foodies
Weekend Cooker
Occasion Cooker
Hybrid Shopper
Least Price Sensitive
Integrated World
Head of Household
On a Budget
Recent Grad
Willing to Spend Most Time Preparing and Cooking

Most Price Sensitive
Willing to Spend Least Time Preparing and Cooking
NEWBIES
There are many types of

customers who value cooking
healthy meals at home
Reformed Traditionals
Extreme Couponers
Student
Customer Segmentations
Curious Cooker
COOKING FOR SPORT

$
EZ DOES IT
Food Embracer
Non-Grocery Shopper
True Foodies
Integrated World
Occasion Cooker
Hybrid Shopper
Least Price Sensitive
Head of Household
On a Budget
Recent Grad
Willing to Spend Most Time Preparing and Cooking

Most Price Sensitive
Willing to Spend Least Time Preparing and Cooking
Curious Cooker
Reformed Traditionals
Extreme Couponers
Student
Targeted Customer Segmentation
The Grocery Club will appeal

to customers who value
convenience above all
Non-Grocery Shopper
Price insensitive, willing to spend
more for convenience, no time for
cooking, frequently orders out
Head of Household
Manages families diet, pre-plans
shopping trips, relatively price
insensitive, has less time for meal
prep/cook
Occasion Cooker
May not have extensive knowledge
about cooking, doesnt cook on
regularly but will for special occasions
Hybrid Shopper
Shops at multiple grocery and home
good retailers for specific purposes,
has relatively more knowledge about
pricing & ingredients, brand conscious
Curious Cooker
Wants to cook but doesnt have the
knowledge or training to be confident
in cooking, interested in cooking a
variety of food, willing to try exotic
recipes, willing to spend more on food
if they know it will be worth it, likes
dining out
Market Share
Online grocery sales projected to increase
50%
PeaPod
Market
Share
$589 B
1.4%
Online Grocery Sales
US Grocery Sales 2010
$451,000,000
PeaPod Revenue 2010
375,000
Customers
98.6%
Brick & Mortar
Grocery Sales
REVENUE MODEL
RESOURCE VELOCITY
Weekly Subscription pricing of

6-21 meals/week.
High inventory turns possible

since stock is limited based
on limited number of meals.
Menu suggestions based on
seasonal special pricing.
Profit
Model
TARGET UNIT MARGIN
COST STRUCTURE
Conservative pricing strategy

positions unit margins at 30%
High fixed costs->

Subscription pricing supports
pushing volume
Profit Model
The Grocery Club positions its

pricing strategy between retail
grocery shopping and prepared
meals from restaurants
Costs
Conservative Pricing Strategy
YEAR 1
Development
YEAR 2
Rollout
YEAR 3
Growth
Assumptions
Conservative Pricing Strategy

ESTIMATED MEAL COST
$5 Average meal cost (per person)
2 Number of people (per meal)
12 Number of meals per week
$120 Total avg food cost per week
PRICE
1S
Subscription Number
30% Markup percentage
$36 Margin
$156 Price per week
INITIAL ASSUMPTIONS
YEAR 1
Y1 // Develop infrastructure for service (staffing, IT, WMS,

website integration, sculling line build out
Adoption rate at 0% due to development
YEAR 2
YEAR 3
0 Estimated number of adopters

$0 Estimated revenue per week
52 number of weeks
469
$73,125.00
52
$877,500
Estimated number of adopters

Estimated revenue per week
number of weeks
Profit
Conservative pricing considering WTP in this space

Meal costs are an average, so we have margin to play with in
case they are higher than estimates once we rollout
Rollout in 2 sites in Y2, then expand to 4 in Y3 (Peapod has 24
total sites)
IMPLEMENTATION
Y2 // Rollout into 2 markets

Adoption rate estimated at 1.5%
Y3 // Rollout into additional 2 markets
Adoption rate estimated at 2.0%
KEY PERFORMANCE INDICATORS
1,250 Estimated number of adopters

$195,000 Estimated revenue per week
52 number of weeks
Number of subscribers
Customer retention for subscription service - projections
assume that subscribers will have paid for the whole year
Number of meals served
BREAKEVEN POINT
Total meals served at 259,487 to breakeven at low estimate (416

subscribers @ 12 meals/week for 52 weeks)
Cash Curve*
THE GROCERY CLUB will realize profits

within 3 years of start
YEAR 1
6,720,000
IDEA
GENERATION
YEAR 2
COMMERCIALIZATION
YEAR 3
REALIZATION
Support
costs
Speed to
market
Time to
volume
Startup costs
-1,323,000
LAUNCH
*For a household of 2 people at $156 weekly subscription for 12 meals per week
Cash Curve*

YEAR 1
6,720,000
IDEA
GENERATION
YEAR 2
COMMERCIALIZATION
YEAR 3
REALIZATION
YEAR 1
Support
costs
Market
Time to study in
volume
Washington
DC
and Chicago
Speed to
market
Startup costs
-1,323,000
LAUNCH
Cash Curve*

YEAR 1
6,720,000
IDEA
GENERATION
YEAR 2
COMMERCIALIZATION
YEAR 3
REALIZATION
YEAR 2
Speed to
market
Time to
volume
Support
costs
Pilot in two
cities with one
warehouse in each
Startup costs
-1,323,000
LAUNCH
Cash Curve*

YEAR 1
6,720,000
IDEA
GENERATION
YEAR 2
COMMERCIALIZATION
YEAR 3
REALIZATION
YEAR 3
Speed to
market
With successful
pilot, roll out two
to
more cities Time
volume
Support
costs
Would not see any

equipment costs
and would be most
profitable
Startup costs
-1,323,000
LAUNCH
Maximizing Efficiency
How might we...
INCREASE SPEED TO MARKET
REDUCE START UP COSTS
Identify which cities to do the pilot, develop web

platform and train employees within first year
Use existing vans and warehouse space to

leverage synergies with Peapods existing
infrastructure
12 month market study in Chicago and DC

Strategic partnerships and marketing campaigns
to increase adoption rates
Easily replicated and scaled warehouses

New web platform utilizing current IT infrastructure
REDUCE TIME TO VOLUME
REDUCE SUPPORT COSTS
Scale-up to 2 additional cities across the United

States in Year 2
IT and Website integration
Standardization and delivery of consistently highquality service and goods
Sculling line build out (existing warehouses

Chicago and DC)
Easily-maintained, smaller warehouses
THANKS,
Questions?
APPENDIX
APPENDIX
Comparative Costs for other Meals - Willingness to Pay

Meal Type
Cost per Person
# in Family
Total Cost
Frozen
Fast Food
Take-Out Food (ex. Chinese food)
Grocery Club
Fast Casual (ex. Corner Bakery)
Casual Dining
$4
$5.51
$8
$10.41
$11.5
$15
2
2
2
2
2
2
$8
$11.02
$16.00
$20.82
$23.00
$30.00
Cost for 12
Meals
$96
$132.24
$192
$249.84
$276
$360
Sources:
http://www.kellogg.northwestern.edu/faculty/matsa/htm/Reynolds-2009.pdf
http://en.wikipedia.org/wiki/Fast_casual_restaurant
http://voices.yahoo.com/best-frozen-entrees-best-tasting-best-prices-3836352.html
Typical Weekly Grocery Bills by Generation
Top Reasons why shoppers leave their grocery stores
Millenials
Generation X
Boomers
Matures
43% ISO Lower prices

25% Poor Selection, Long Lines, Poor Quality
17% Employee Rudeness
14% Crowds
$69.40
$107.10
$106.40
$89.60
Source:
Conumer Reports, Best & worst supermarkets, May 2012, pp16-23
Source:
Conumer Reports, Best & worst supermarkets, May 2012, pp16-23
APPENDIX
Finanical Projections for Multiple Pricing Scenarios
2 people, 12 meals/week
YEAR 1 - DEVELOPMENT
Total Revenue
Total Costs
Net Profit
Cumulative Cash Flow
YEAR 2 - ROLLOUT
1.5% adoption rate in 2 markets
469 subscribers
Total Revenue
Total Costs
Net Profit
YEAR 3 - RAMP-UP
2.0% adoption rate in 4 markets
1,250 subscribers
Total Revenue
Total Costs
Net Profit
Low Estimate
($156/week)
$0
$1.3M
-$1.3M
-$1.3M
Mid-Range Estimate
($200/week)
$0
$1.3M
-$1.3M
-$1.3M
High Estimate
($250/week)
$3.8M
$2.9M
$1.7M
$386K
$4.875M
$2.2M
$2.7M
$1.3M
$6.0M
$2.3M
$3,8M
$2.5M
$10.1M
$3.4M
$6.7M
$7.1M
$13M
$3.7M
$9.3M
$10.6M
$16.3M
$4.0M
$12.2M
$14.7M
$1.3M
-$1.3M
-$1.3M
MID-RANGE ESTIMATE - YEAR 1

(based on higher subscription price)
EST MEAL COST
PRICE
2H
YEAR 1
YEAR 2
YEAR 3
$5
2
12
$120
Average meal cost (per person)

Number of people (per meal)
Number of meals per week
Total avg food cost per week
Revenue
Costs
YEAR 1 -- DEVELOPMENT
375,000 current peapod annual customers
Equipment
Subscription Number
$80 Margin
$200 Price per week
52 number of weeks
469
$93,750
52
$1,950,000

number of weeks
Profit

52 number of weeks
Website Dev
Labor
Marketing
0.00%
0
0
0
0
$0
(typical early adopter rate)

adopters
meals per week
weeks per year
total meals per year
prepared meal revenue/yr
$15,000
7
$105,000
2
$210,000
50,000
$5
$483,000
cost est per piece equip, need peeler, scrubber,

dishwasher,
pieces of equip on avg
total equip costs per processing site
sites
total equip costs across corporate
scullery sq ft est.
$/sq ft/yr
total additional rent
2
$150,000
1
$300,000
developers at $150k for 6 months

salary plus benefits
years
total dev costs
$30,000.00 labor per year p/p

3. workers per site
$90,000.00 yearly labor costs per site
2 sites
$180,000 total labor costs across corporate
10% percentage of sales (includes packaging)

$0 total marketing cost across corporate
Management & Customer Service
2 additional staff
$75,000 yearly salary
$150,000 total additional labor costs
Total Costs
$1,323,000 fixed + variable across corporate
Net Profit
-$1,323,000
-$1,323,000
Revenue
Costs
YEAR 2 -- ROLLOUT & PILOT
Equipment
Website Dev
Labor
Marketing
375,000
31,250
1.50%
469
12
52
292,500
$4,875,000
current peapod annual customers

estimated market size in pilot (2 warehouses)
adopters
meals per week
weeks per year
$15,000
7
$105,000
2
$210,000
50,000
$5
$483,000

dishwasher,
sites
scullery sq ft est.
$/sq ft/yr
1
$150,000
1
$150,000

years
total dev costs

7. workers per site
2 sites

$487,500 total marketing cost across corporate
6 additional staff
Total Costs
Net Profit
$2,674,500
$1,351,500
Revenue
Costs
YEAR 3 -- CONTINUED ADOPTION
Equipment
Website
Labor
Marketing
375,000
62,500
2.00%
1,250
12
52
780,000
$13,000,000

adopters
meals per week
weeks per year
15000
7
105000
4
$0
50,000
$5
$966,000

dishwasher,
sites
scullery sq ft est.
$/sq ft/yr
1
$150,000
1
$150,000

years
total dev costs

7. workers per site
4 sites

$1,300,000 total marketing cost across corporate
6 additional staff
Total Costs
$3,706,000 fixed + varialbe across corporate
Net Profit
$9,294,000
$10,645,500
HIGH-RANGE ESTIMATE - YEAR 1

(based on higher subscription price)
EST MEAL COST
PRICE
2H
YEAR 1
YEAR 2
YEAR 3
$5
2
12
$120
YEAR 1 -- DEVELOPMENT
375,000 current peapod annual customers
Average meal cost (per person)

Number of people (per meal)
Number of meals per week
Total avg food cost per week
Subscription Number
$130 Margin
$250 Price per week
52 number of weeks
469
$117,188
52
$3,168,750
Revenue

number of weeks
Profit

52 number of weeks
Costs
Equipment
Website Dev
Labor
Marketing
0.00%
0
0
0
0
$0

adopters
meals per week
weeks per year
$15,000
7
$105,000
2
$210,000
50,000
$5
$483,000

dishwasher,
sites
scullery sq ft est.
$/sq ft/yr
2
$150,000
1
$300,000
developers at $150k
years
total dev costs

3. workers per site
2 sites

$0 total marketing cost across corporate
2 additional staff
Total Costs
Net Profit
-$1,323,000
-$1,323,000

Revenue
Costs
YEAR 2 -- ROLLOUT & PILOT
Equipment
375,000
31,250
1.50%
469
12
52
292,500
$6,093,750
Website Dev
Labor
Marketing

adopters
meals per week
weeks per year
$15,000
7
$105,000
2
$210,000
50,000
$5
$483,000

dishwasher,
sites
scullery sq ft est.
$/sq ft/yr
1
$150,000
1
$150,000
developers at $150k
years
total dev costs

7. workers per site
2 sites

$609,375 total marketing cost across corporate
6 additional staff
Total Costs
Net Profit
$3,771,375
$2,448,375

Revenue
Costs
YEAR 3 -- CONTINUED ADOPTION
375,000
62,500
2.00%
1,250
12
52
780,000
$16,250,000
Equipment
Website
Labor
Marketing

adopters
meals per week
weeks per year
15000
7
105000
4
$0
50,000
$5
$966,000

dishwasher,
sites
scullery sq ft est.
$/sq ft/yr
1
$150,000
1
$150,000
developers at $150k
years
total dev costs

7. workers per site
4 sites

$1,625,000 total marketing cost across corporate
6 additional staff
Total Costs
$4,031,000 fixed + varialbe across corporate
Net Profit
$12,219,000
$14,667,375
Peapod Integrator
Local restaurants
Local Stores
Farmers markets and
produce hubs
Assembly and delivery

of products from multiple
suppliers.
Managing relationships with
local stores, restaurants and
markets.
Managing the web interface
for suppliers as well as
customers.
Delivery vans
On-the-ground sales force
BUSINESS MODEL CANVAS
Provides the experience of enjoying

meals at home, without being
limited by any single service
provider. For the person who has
favorite items at many different
stores, markets and restaurants
and wants to be able to assemble
a customized shopping basket that
gets delivered to their doorstep.
Seamless integration
- convenience oriented
customers.
Self service and automated
service
Convenience
obsessed hybrid eaters.
Has favorite items at many
different stores, markets and
restaurants and wants to be
able to assemble her own
shopping basket.
Will create what works for
them from multiple vendors.
Knows what they want from
where.
Online platform
Delivery vans and agents
Temporary storage warehouses

Online platform that integrates
multiple suppliers
Infrastructure of delivery vans and warehouses
Advertising from restaurants, stores, markets
Online store management
Usage fees
Maintainance of database of suppliers and customers
Product placement from restaurant recipes and other kitchen

product suppliers.
Multi-Sided Platform Chef Connector
- Local restaurants or chefs

looking to expand their
customer base
- Online platforms such as
Facebook, Match.com,
Meetup.com, possibly
Opentable.com
- Personalized inventory fulfillment

- Online order management and event
facilitation
- Devising ways to further engage the
customer and pull culinary preference
data about them to make the database
more valuable and enable higher
brokerage fees
- Portioning system and delivery

fulfillment system
- Manufacturing and supply chain
experts
- ERP programming experts
- Culinary experts, and chefs
- Inventory fulfillment system

- Online database and order entry system
- Tie-in to Facebook or dating network (theyd license out this specialized
module to those platforms)
- Licensing Fees if not offset by providing chef new customer access
- Multi-Sided platform bringing

emerging chefs and restaurants
together with food connoisseurs
- Catered cooking parties
- Access to hip restaurant or
chefs exclusive recipes &
knowhow
- Novel and highly tangible
(olfactory, visual, taste) in-home
entertainment
- Removing the work from having
a party with more than beer and
chips
- A new way to interact with your
friends
Personal service
Integration with existing
social network app of
choice
Culinary Social Butterfly

Food connoisseurs that
dont have time to do the
setup
Singles looking for new
kind of speed dating
Emerging chefs and
restaurants looking to get
noticed
- Entice online
- Engage - in-home
- Extend - through socialization
bonds created with people of like
minded culinary interest
- Advertising fee from new food brands looking to get their brand in front of customers
- Planning fees and increased margins on pre-measured foods
- Advertising fees from local restaurants looking to get their food brand established (may be risky to the restaurant
considering a home cook could screw up the recipe and tarnish the restaurant brand.
- Licensing fees to social networks looking to add a deeper element for members to connect across
- Reservation brokerage fees for connecting (reservations) our database of users to their restaurants. We will become
the knowledge experts of who likes to eat what, and use that to pair customers with restaurants. It would go beyond
OpenTable by knowing more about users culinary preferences.

The Grocery Club, A Business Model

Uploaded by

Document Information

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

The Grocery Club, A Business Model

Uploaded by

Copyright:

Available Formats

THE GROCERY CLUB

Shifts in Consumer Preferences

From Fast Food to Good Food

We can start to see a shift in consumer preference from

2 | The Grocery Club | May 3 2012

Cooking and Preparing Meals

3 | The Grocery Club | May 3 2012

For grocery customers who are dissatisfied with

4 | The Grocery Club | May 3 2012

5 | The Grocery Club | May 3 2012

Establish your subscription service

Number of people in household

6 | The Grocery Club | May 3 2012

Number of meals desired per week

Establish your subscription service

7 | The Grocery Club | May 3 2012

Plan your meals for the week

Grocery Club sends

8 | The Grocery Club | May 3 2012

Add additional groceries and dry goods

Review, check out, and print

Print Meal Plan for the Week

9 | The Grocery Club | May 3 2012

Order locked in at noon day prior

10 | The Grocery Club | May 3 2012

are hand-selected & picked first

Groceries are delivered to TGC Member

11 | The Grocery Club | May 3 2012

TGC Member is ready to prepare a meal

Ingredients prepped, sorted, and

Grocery Club Chef Apprentice App

13 | The Grocery Club | May 3 2012

Less prep equals less clean-up

Premium services create additional value

Monthly visit from personal

Additional revenue from add

Business Model Canvas

The Grocery Club

Other cooking related

Content creation vendors

Scheduling and Planning

dont have the skills and

Rent for Preparation space

Additional Grocery Sales

Fleet Leasing for Delivery

Media Content development costs

Software development and IT support

Partner revenue for associated services

15 | The Grocery Club | May 3 2012

Relationships between Variables

The online portal supports GC customer experience

dont have the skills and

Rent for Preparation space

Additional Grocery Sales

Fleet Leasing for Delivery

Media Content development costs

Software development and IT support

Partner revenue for associated services

16 | The Grocery Club | May 3 2012

Relationships between Variables

The online portal supports GC customer experience

Planning Webbased Software

Portion control, dietary