Qthru is one of the many iPhone apps available enabling customers to scan barcodes and QR codes. What is interesting is that it also offers an opportunity to check out and pay thanks to the interaction with a check-out self service station at the local store.
This great idea comes directly from the United States – and it is the best way for selling REAL locally grown products in grocery stores.
It’s in fact no secret that most produce purchased in grocery stores is far from “green,” grown in far away states and countries and transported hundreds, even thousands of miles, adding costs and carbon footprint along the way.
A New York City start-up called BrightFarms hopes to changes all that, one grocery store rooftop at a time. The company plans to design, build, finance and operate hydroponic greenhouse farms on supermarket rooftops, eliminating time, distance and cost from the food supply chain.
“It’s better food, better for the environment and better for business,” CEO Paul Lightfoot told Greener Design during a recent interview. “The idea of growing veggies on the roof of a supermarket struck me as cute, but what I wanted to know was whether it could become a real business, with scale. One of my reservations about local food is that small farms (and most farms near cities are small) can’t compete on price with big ones. So food at many farmer’s markets tends to be a pleasant indulgence for those of us who can afford it.”
The business premise is that BrightFarms can deliver better, fresher, more nutritious produce. Secondarily, Lightfoot said, it is better for the environment. The hydroponic greenhouses (which uses only water and nutrients, no soil) would focus on high-volume vegetables such as lettuces, tomatoes, herbs, cucumbers and peppers, typically at a cheaper cost.
“In some instances, we’re actually selling for less,” Lightfoot said. “We can pretty much match the market’s wholesale tomato costs. We can beat the market’s loose leaf lettuce costs.”
Although he would not reveal which grocers BrightFarms is currently speaking to about installing the rooftop greenhouses, Lightfoot said seven large retailers have signed letters of intent, noting that he expects a few of them to be built before the end of the year.
BrightFarms grew out of New York Sun Works (WYSW), a non-profit organization set up in 2006 by environmental engineer and urban farming visionary Dr. Ted Caplow. Its mission was to design and promote ecologically responsible systems for the production of energy, water and food in the urban environment. In 2007 NYSW launched the renowned Science Barge, prototype urban farm.
Last month, BrightFarms announced the completion of another round of financing through private investors, however it did not disclose the amount of money raised. (Source: GreenRetailDecisions)
We found this article by Avinder Batra, published on IndianRetailer.com very interesting because of its very detailed approach to the implementation of a home delivery service for those small groceries retailers that are facing the competition with by multinational like Wal-Mart. This is also a business model which is very sustainable, by lowering CO2 transportation emissions and by mainting vital the traditional small retail grocery business.
Batra identifies a big trend in the grocery business- home delivery- due to two main reasons:
-High fuel price: Indian families are not interested in spending time on these products
-Families want more leisure time for themselves: Since both the partners are working, shoppers find this activity as waste of time to collect groceries in weekends
“When most of the big retailers are fighting for larger space, opportunities can be foreseen where you do not have compact space and can still run successfully through Etailing the Grocery model” Batra says.
The solution could be a mix of website, mobile, IVR.
High rental costs have made the retail business cumbersome for the independent players. As told by Ragib Hussain, VP, Vice President Strategy at e.Soft Technologies, “This type of model does not need much of investments. Etailing models (having virtual shop) can help retailers in expanding the business thus by covering larger area & reap good volumes.”
Small independent retailers need to increase their customer base: Online services and then home deliveries would fetch revenues only when you have large customer base. Margins are the rewards which an investor gets and this is what he has to work on to have with minimum liable cost.
Develop tie-ups/partners: Developing partnership agreements with the kirana shopkeepers and others nearby shops in the area that would reach the consumers through home delivery systems. This should be the initial step of building a strong network in the areas concerned you want to cover.
Also, it would decrease the liability on the retailer—warehouse cost, maintenance cost, procurement cost, etc.
Develop your own site and make a strong viable back-end system for smooth functioning of the business model: either by creating your own hosted website or by opting for cloud services, this is a very important step. Cloud services would play a vital role to make updated connections with your suppliers, logistics suppliers, CRM updates and drop shipping suppliers. Because time is a critical factor, efficient distribution is of utmost importance. Technology plays a key role in enabling an efficient dairy distribution model.
This is the back bone of the whole concept when the business starts working and it is the most challenging part of the business to make real-time connectivity with them.
Home delivery services: By tying up with the partners in the local areas, investor can direct the orders to those shops and through delivery boys; the task can be executed smoothly. This would even increase the revenue prospects of the local partners.
If the business model is churning profits, there is no harm in having your own warehouses and company owned shops in the localities. This could be the way to expand your business model and make it stronger.
Each small outlet should be centrally connected to the warehouse to record the sale and updates are on real time basis. This would help to replenish the goods which are going out of stock.
Delivery system: Tempos and other mini trucks can be used to provide deliveries in the located areas if orders come in bulk in particular area. (Source: IndiaRetailer.com)
Though few retail grocers offer home delivery of web orders, a survey from the Food Marketing Institute, a grocery industry trade organization, suggests that consumers respond more to web grocers that offer to deliver online orders compared with grocers that require pickup at their stores.
In 2010, 32% of consumers responding to an FMI survey said their primary grocery store offered online ordering, and 28% said they had done at least some online ordering at those grocers. 4% said they shopped online at those grocers one to three times per month, and 2% said at least once a week. But 22% said they shopped online at those grocers less than once a month, with another 73% saying they never shopped there online.
By comparison, the FMI survey showed that only 17% of respondents said their primary grocery store offered home delivery—but 13% said they ordered home delivery one to three times per month, and 5% said they did so at least once a week, higher figures than for when home delivery was not an option. 17% said they ordered home delivery less than once a month, leaving 65% saying they never did.
Regardless of the demand for it by consumers, however, home delivery of groceries isn’t for all retailers, experts say. “Home delivery is only going to work for really big folks with profitable online grocery operations offered in places where the retailer has a reasonable density of customers,” says Jack Horst, a retail strategist at retail industry consultants Kurt Salmon.
The category of “really big folks” surely includes Amazon.com, the largest web-only retailer, and Wal-Mart Stores Inc., the world’s largest retailer and the leading U.S. grocery merchant. Both Amazon and Wal-Mart are experimenting with home delivery of groceries.
Amazon’s program, dubbed AmazonTote, has been tested by the company’s employees in Seattle for the past six months or so. In its infancy, the service entails weekly delivery of groceries and other items to the user’s home, with the groceries bagged in reusable tote bags, all free of charge.
Fresh offers fresh produce and meats in addition to non-perishable grocery items; the service goes beyond food, too, ranging from pet supplies to beauty products and other Amazon.com categories. Granted, the convenience is reflected in the price — would you pay $2.50 for a single grapefruit under any other circumstances? — but you get what you pay for, which in this case amounts to a lot of time and energy saved.
On the other side, the “Walmart To Go” test , just launched in California last Saturday, allows customers to visit Walmart.com to order groceries and consumables found in a Walmart store and have them delivered to their homes, a company’ spokesman said. Products include fresh produce, meat and seafood, frozen, bakery, baby, over-the-counter pharmacy, household supplies and health and beauty items. Wal-Mart also offers a Pick Up Today service, which is limited to select electronics, video games and appliances.
What Amazon also needs to fear is a new initiative from the company called @WalmartLabs. According to GeekWire, this new Silicon Valley-based arm of the company is stating it has pretty lofty goals: “Walmart plans to expand the @WalmartLabs team and expects this new group will create technologies and businesses around social and mobile commerce that will support Walmart’s global multi-channel strategy, which integrates the shopping experience between bricks and mortar stores and e-commerce.”
In other words, exactly what Amazon does, except with the integration of brick and mortar stores.
Walmart seems to be turning its collective eyes towards technology more and more as of late, the only real question is what took them so long. If the discount store giant starts pouring its massive resources into more technology integrations, releasing its own products and taking on the likes of Amazon, we could see the company slowly take over eCommerce just as it did with the retail world.
The majority of grocery retailers still prefer store pickup of online orders, as MyWebGrocer* CEO Rick Tarrant says. But if the Wal-Mart and Amazon test will prove to be successful, we are pretty sure that at-home delivery will be the next big trend.
*MyWebGrocer, a provider of e-commerce and digital marketing technology and services to more than 110 grocery retailers, has supermarket clients including ShopRite that offer home delivery in some markets