HomeGrocer.com merged with Webvan.com in the early 2000s, to capitalize on what seemed an obvious use of the Internet. The concept was simple: consumers could shop from the Web for groceries, and they would be delivered to the consumer's residence at a date and time convenient for the customer. The trucks could transport refrigerated and frozen goods as well as nonperishable items. Home Grocer was better liked by consumers, while Webvan had greater financial resources. Another company, Streamline.com, required customers to pay a monthly fee and install special equipment in their home. Streamline.com failed by 2001 (Borrego, 2001), as did the merged Webvan/HomeGrocer company was in trouble, however, and cutbacks were made ("Webvan to exit," 2001). By the end of 2001, the company was gone altogether.
Consumers have embraced the concept of Internet shoppingùselecting items online and having them delivered. However, groceries may prove problematic, particularly with regard to fresh and perishable items. These are often chosen based on inspection by the consumer, which can make it difficult to accomplish over the Internet. Companies in this business did not use third-party shipping companies, such as DHL or FedEx, but instead had their own trucks. These trucks, in turn, had to have special equipment, which further drove up the logistical costs. Consumers might be more accepting of this concept today, but the spectacular failure of companies in the past may make it difficult to find financing.
Borrego, A. M. (2001, January). Online grocer fails to deliver the goods. Inc. Retrieved 9 Feb 2006 from: Webvan to exit Dallas market. (2001, February 23). American City Business Journals. Retrieved 9 Feb 2006 from: ...