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Fresh food meets the Web

Retail

FreshDirect sells fresh food online that comes directly from farms, dairies, and fisheries, delivered to Manhattan homes or offices, at prices 10-30% lower than other local grocers.

FreshDirect sells fresh food online that comes directly from farms, dairies, and fisheries, delivered to the home or office, at prices 10-30% lower than other local grocers.

OK, here’s an idea: why not start selling fresh, top quality gourmet foods like meat, fish, vegetables, cheeses and breads to demanding consumers, businesses and restaurants, delivering it ‘Kozmo’, ‘WebVan or ‘Urbanfetch’ style? Does this sound too 1998? Not to Joe Fedele, founder of FreshDirect, a food processing plant in Queens, New York, that provides customers access to its goods via the Internet, selling fresh food that comes directly from farms, dairies, and fisheries, delivered to the home or office, at prices 10-30% lower than other local grocers. At the refrigerated, state-of-the-art food processing plant, FreshDirect roasts its own coffees, bakes breads and pastries from scratch, and cuts each piece of seafood and meat to order. Since customers don’t shop in the facility, FreshDirect can maintain different environments for each type of food they sell. (For example: seven different climates for handling produce ensure that the bananas are just as happy as the potatoes.) Product categories encompass Fruit & Vegetables, Coffee & Tea, Meat, Seafood, Deli, Cheese, Bakery, Pastry, Pasta, Kitchen, Dairy, Frozen, Grocery, and Specialty. The website offers a customized shopping experience, letting customers decide how thick they want their steaks, or how ripe their tomatoes. There’s even an array of prepared foods cooked to one’s liking. Right now, delivery is only offered to Manhattan’s East Side and Battery Park City, but the service area is quickly expanding. A $40 minimum order applies, plus a $3.95 delivery charge. As far as copying this business idea is concerned, FreshDirect isn’t exactly for the ‘working from home’ crowd: they’ve raised $120 million (!) to get going. First results (according to the company) are promising. Keys to success: restructuring the food-delivery supply chain and using cutting-edge technology to gain unprecedented efficiencies.

Opportunities

With consumers becoming more demanding (and spoiled!), food and beverage wise, Fresh Direct may have carved itself an interesting niche next to supermarkets (from groceries to ready-to-eat meals), dining-in and dining out restaurants, and semi-ready to cook plays like UK’s Leaping Salmon. Should do well in most large metropolitan areas around the world: if you don’t have $120M, just keep an eye out for franchising and expansion plans! Not to mention the interesting supply-prospects if you’re in farming.

Website: www.freshdirect.com/

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