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 ...view middle of the document...
Within the facilities, every thermometer, scale, and conveyor belt are connected to the central command center. The facility center is composed of 12 separate temperature zones and food is kept at its optimal temperature for preservation. This helps the company keep up with their high standard for cleanliness, health, and safety, but system efficiency has been the prime focus to ensure FreshDirect’s success.
Furthermore, FreshDirect’s five-star rating system is an easy way to accommodate consumers who question the freshness of the fruits and vegetables that they are ordering. During this process FreshDirect’s produce managers comment on and rank each product based on their rating systems. The managers update their ratings from the previous day to ensure that their recommendations remain accurate for the current day’s deliveries. The ranking criteria includes taste, color, firmness, and ripeness.
FreshDirect has the distinct advantage over their competitors when it comes to purchasing their products. Their supply of fresh and dry products are handpicked from individual growers and producers and then sent directly to FreshDirect’s distribution center. Because they deliver to a very concentrated area and buy most produce locally, FreshDirect has a stronger relationship with their local providers than their competitors, who deliver to a broader region.
FreshDirect’s most recent challenges have been labor-related. Their 500 delivery drivers joined a union after arguing that their hours were too long and wages were subpar. These labor issues can be very corrosive to a corporate culture and can destroy their public image. The company has to enter into negotiations with them in order to keep the drivers happy and avoid a labor stoppage, which would be detrimental to the company.
Environmental issues have recently become an issue for FreshDirect. The grocer uses cardboard boxes to package and deliver their items, but numerous customers complained that the use of excessive cardboard boxes is harmful to the environment. In today’s economy, consumers are becoming more aware of environmental issues and make purchase decisions based on their perception of a company’s environmental reputation.
FreshDirect has also incurred additional costs in order deliver to their customers on time. In New York City, delivery drivers are forced to double-park or block a city street and have accumulated hundreds of thousands of dollars in traffic tickets. These extra cost are putting pressure on FreshDirect’s target profit levels as they rack up thousands of dollars in the accounting books.
To combat these weaknesses, FreshDirect simply needs to ensure that their technology remains current with—or ahead of—changing trends. Their first move would be to create an app that is compatible with smartphones and tablets so customers can view the available items, create shopping lists, rate the quality of their produce using the 5-star system, and...