ISYS1021 Lecture Notes - Lecture 2: Opentable, Mint.Com, Switching Barriers
9 Mar 2016
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Freshdirect sells to 600,000 customers as of a year and a half ago. Cheaper real estate one costs less than multiple stores. Labor costs 60% lower (employees work even pace, rather than work hard during spike times and sit around during down times) Lower energy 12 separate climate controlled rooms set for food, not people (bonus: fresher food) Inventory turns the # of times inventory is sold or used duing a given period (year or quarterly) Cash comes in faster, can pay suppliers faster, can lower prices even more. 5 times larger than the largest nyc stores. Prices 12% to 28% lower (fortune) After fresh direct came up one in three traditional grocery stores shut down. Rareness: limited supply or difficult to acquire. Fiber optic networks, different companies laid down enough cable to go to the moon 200+ times (glut)
