Memorandum Case Study Analysis
This memo assesses and analyzes the current business model and issues that Dinr has been facing,which includes: inability to raise finance, low number of meal orders, low number of repeated customers and unattractive websites.It further suggests the alternative methods that Dinr can employ in order to stimulate its sales and grow its business. The alternatives includes entering into a contract with supplier to deliver the goods directly to the customer’s place in order to save storage costs or to get into a venture capital with its competitor Gousto.In addition, the memo provides recommendation to the company related to how each alternative will be implemented.
Issues:
In 2012, Markus Berger, the former employee of Google and an MBA graduate cofounded Dinr with Atul Mahajan who was responsible for only technical areas of the business for one year as he was planning to start his own company. Dinr offered on-demand same day delivery of meal ingredients to young professionals residing in London with busy schedules searching for healthy homemade and balanced foods. The business model of Dinr comprised of targeting urban professionals with an income of more than €38,000 per person as other competitors in the UK which includes Hello Fresh and Gousto targeted traditional families towhom the service was a utilitarian thing.
The founders started the business with the capital of €42,500 and set up an internet domain, storage space, ordering process and packaging methods. However, the company was only able to sell 62 meals as compared to the planned sales of 100 meals and 70% of the customers never reordered the meals from the company. In order to stimulate sales and grow the firm, the CEO of the company needed to obtain funding of €225,000 for which he enlisted the company on Seedrs, an equity crowd funding platform. He tried to obtain finance by getting into London’s startup accelerators,but got failed to get selected due to the low sales, and the fact that the co-founder would leave the company soon......................
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