Grocery Delivery websites

[mduffley]

My partners and I created an online grocery shopping and delivery service at Syracuse University and expanded to Cornell University and Ithaca College.

We now use our grocery shopping software to help other entrepreneurs set up their own grocery shopping delivery services. We created Custom Grocery Inc., which builds customized grocery shopping websites.

Grocery shopping services are simple to set up and easy to run. Overhead is next to nothing, as you don't have to lease a retail space. We pay college students $7 an hour to do the shopping and delivering, and do really well.

Our Syracuse location had revenues of over $150,000 last year - just the third year in business.

[zoobie]

That's good to hear.

Welcome to YE!

[mduffley]

Thanks! I just came across this website - I'm impressed...

[usakos]

Nice site. Good luck.

[Young Spark]

Gotta say, I'm impressed, never knew such a business could be successful but you've totally proved it. Congrats and hope to see it bigger then ever.

[stand856]

great idea, was thinking about something like that 7 years ago when looking for a job, i guess got lazy never through with that glad someone else did

[Paint and Air Sportz]

This is very interesting, what i am wondering is do you have like a warehouse where you store the products or do you just get them from a local grocery store, or do you own a grocery store.

And when my brother goes to ithica next year ill deffiantly tell him about this site.

[jasaunders]

Very nice site. Congrats on your success so far. Lot of room for growth.

[Unreal030]

I am impressed and this actually would be an interesting business for me to start up I suppose at college. I was unsure of how profitable it would be but well..haha

I would like to enquire and see if, with some initial guidance you would like your business to expand into Iowa (Iowa State University initially) for instance, I would much rather aide an existing company in something like this than start up my own if they felt it was a good idea. If not then that is understandable, and I will look a bit more into it and maybe start my own there perhaps. I was planning on starting some kind of college student focused business as not only would I be a part of my own demographic but the location convenience would make it an excellent starting market and this might be a suitable idea. Let me know via pm, thanks for taking the time to bring about this information.

[syia]

impressive.. keep up updating about your business.anyway.. how much are you charging to earn profit?

[Unreal030]

I am also curious how you get your supplies, through a warehouse or otherwise. I just read more about the whole system on your site however hypothetically, how would you set me up if I were to indulge in this service if I wanted to start one up and have it initially based out of a university in Iowa? Especially concerning supply of the food products since you are based in NY however your software is advertised in a way that you would be able to give supply services to the purchasee without conflict of where they are located withing the United States, there is no mention of area specific conveniences.

I feel there is immense potential in such services especially if one were to later on add more to the dorm-specific goods and services area of the business model. Also like you said, its has relatively low startup costs and little to no overhead.

The prices for goods on your website are pretty standard and not overpriced which leads me to believe your supply source is a grocery store(s) that you own or you get the products directly from their manufacturer like the brick & mortar retail businesses. If it were not either of those I would imagine it hard to have much of a profit margin through each individual product if you supply through retail purchase or some other system, given your product pricing.

[mduffley]

Right now we own two locations that we run ourselves - Syracuse and Ithaca/Cornell. With each of those businesses, we lease a small non-retail office space (less than 400 square feet each), and use those as our "food warehouses". We don't keep any inventory onhand - we only buy what is purchased off the website by our customers. On our website, One Click Grocery, we offer almost all products that Wegmans (a huge local chain) sells. We took down every price of every product in the store, and mark each product up a percentage. We then charge a $4 delivery fee, which is waived on orders over $75. We do all of our shopping first thing in the morning (6am) and purchase everything all at once and then separate each order for delivery when we get back to our office.

We use Custom Grocery to license our software to other entrepreneurs. Right now we have 21 clients that we work with. It makes sense for someone that wants to break into the business because the software that we developed cost a shade under $80,000 to create. It works well because we have done it ourselves and can offer our consulting services free of charge.

We charge a flat fee to design your website ($899) and a monthly licensing fee ($230 - $260 depending on some of the extras). Our web designers can also do extra custom work at a discounted hourly rate if needed.

This business model works extremely well in a college town because it is so easy to reach your target market. We go through the dorms and flyer each dorm room, put magnets and door hangers on apartment doors, and word of mouth spreads fast on campus. Dorms especially - we must deliver at least 20 cases of water and 30 twelve-packs of soda to dorms every day. For students, their parents can deposit money into their account at any time and they use that money towards their purchases. Or, you can use credit card or COD.

Any other questions - feel free to let me know - or pm me.

[usakos]

Just one question; how is yours different from WebVan.com, which went out of business in 2001? See http://en.wikipedia.org/wiki/Webvan

[mduffley]

Webvan went about it the wrong way:

"While Webvan was popular, the money spent on infrastructure far exceeded sales growth, and the company eventually ran out of money. For example: Webvan placed a $1 billion (USD) order with engineering company Bechtel to build its warehouses, bought a fleet of delivery trucks, purchased 30 Sun Microsystems Enterprise 4500 servers, dozens of Compaq ProLiant computers and several Cisco Systems 7513 and 7507 routers, as well as more than 80 21-inch ViewSonic color monitors and at least 115 Herman Miller Aeron chairs (at over $800 each)."

We are different because we don't have large food warehouses and we don't keep inventory onhand. We only buy from the grocery store what is already paid for by the customer. Simply put: we keep our overhead low.

The other successful business model would be to have an existing grocery store license our software and use that site to run a grocery delivery service out of their existing store. i.e. Peapod with Stop & Shop

[stand856]

Pretty much what would take most of the time prior to launch is getting all of the products that a store would carry into the online store.
How long did it take you guys to get all of the pricing and items in the online store?