Abstract

The case illustrates the entrepreneurial activities of the online grocery store, homegrocery.com.The companystarted by analyzing the market opportunity in US particularly in Seattle for the rising demand for online grocery shopping.The market at the time of business setup already had intense competition in the market, with manyplayersentering into the market. The case outlines the Homegrocery.com business initiation strategy which included the venture and partnership with the directcompetitor in an attempt to increase the market penetrationand also to meet the cash requiring.The company opened the distributioncenters at a rigors rate.Due to the increasing demand in the market, the company ran out of operating cash and looked for the strategic options to fulfil themarket demand.In doing so, it initially went IPO and raised the capital of 282millon in a day, however in orderto milk the growth in the market, it requiredthe cash flow of 500 million at least.To do so, the company opted to partner with web van- a direct competition yet having a different cash structure and oragznationstructure.The partnership though initiated to meet the market demand for online grocery, however, the lack of experience and the businessperspective resulted in a total failure, SinceWeb van has been in strong position, it posited th pressure on Home grocery to change its functional areas and operationstactics, along with the value proposition, business strategy,This while resulted in dropping of sales, which ultimately left web van with low cash cycles and ultimately filed for bankruptcy.In certain situation, Home groceryhave two strategic alternatives, which are (1) either partnering with web van to fulfill the marker demand and also milk the cash flow streamwhile (2) the secondoption is to manageand maintain the existing operations fully without expandingmore for the current period of time.

Keywords:  Business strategy, Venture, partnership, Strategic alternatives, Technological advancement, online grocery shopping
Home grocers.com Harvard Case Solution & Analysis

INTRODUCTION

Homegrocers.com is an online grocery store, started with an aim to offer the online grocery to the USpopulation. Since the US market become aggressively tech-pro, the companyexpanded aggressively expandingup to 300 distribution outlets all over USA. Since the expansion took so aggressively, the company faced cash flowdeficit to run the daily operationseffectively into the market. Also, since the demand for the online grocery increasedand the company faced direct competition from amazon and other local competitors which made the young business to look for the opportunities and functionalcapacity increase to and capitalize the market growth.In doing so, part fromtapping the market opportunityHome grocersdeveloped astrong value proposition in which it offered convenience, ease and speed to the customers along with high level of customerservice.The customer service offered the companythe competitive advantage in meeting the customer expansion.It is analyses that it is due to suchvaluepropositionand market positioning strategy that thecompany faced tremendousgrowth in short period of time.

Analyzing the market growth and customer behavior, the company went IPO to raise the capital, and also adopted a post IPO strategy of merger with the Web van-a strong competitor of Home grocers.Having the strong market position and cash flow, the acquisition resulted in handing over the operations to the web van, which devised and transformed the operations through its own business strategy. This resulted in customer dissatisfaction and drop in sales. In addition, due to customer sales drop, the company ultimately faced a loss in capital and finally filed for bankruptcy. This impactedon cutting the budget on marketing by 28% which reducedthe sales by 8%.In addition many customer left the brand due to confused position ingand change in business strategy of the business. All this resulted in the total failure for the business activity. In such situation, there are two strategic alternatives discussed in the report which outlines the best practice that the company can adapt to overcome the loss................

This is just a sample partial work. Please place the order on the website to get your own originally done case solution.

Related Case Solutions & Analyses:

Indian Railways: Building a Permanent Legacy Monsantos Genetically Modified Organisms: The Battle for Hearts and Shopping Aisles Parent-Teenager Mediation Exercise: The Mediator Smith Breeden Associates: The Equity Plus Fund (B) Teradyne Inc.: Nothing Ventured Nothing Gained Economics CARRIER AND TYLER REFRIGERATION: AN ACQUISITION FOR GROWTH Optimization Problem Relating to Sting WURLWIND APPLIANCE COMPANY Ant Financial