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Can an Internet Grocery Survive?

Techstination feature for Monday, March 11, 2002

Can an Internet grocery survive? Bloomberg Boot Camp, a report on today's technology. To some... it sounds like a great idea. To others... it seems a little crazy. Who would buy groceries online? While other attempts have folded, Netgrocer is hanging in there... .delivering non-perishable and hard to find items via Federal Express. Standing in the middle of the company's warehouse in North Brunswick, New Jersey... CEO Lisa Kent tells us...

"We have several hundred thousand customers in our database. We ship over five thousand orders per week from this warehouse and we are seeing growth year on year and have since our inception in 1997. We're focused now as I think any remaining online e-tailer is on those customers that order a profitable order configuration, not just those bargain hunters."

Netgrocer ... a private company whose biggest investors include Parmalat and Cendant... is now partnering with brick and mortar supermarkets to fill customer requests for hard to find items. So who is doing all of the online buying?

"If you live in metro New York and it's difficult to get the assortment you want at the price you want and get it home in an easy, convenient way, this is a great solution for you. If you're a new mom and you don't want to take your infant to the grocery store for a period of time, this is a great solution for you."

Kent says other customers are too busy at work to shop... their orders can be delivered to the office. And a significant part of the company's business comes from Americans stationed overseas. Can Netgrocer survive? I wouldn't say it's in the bag... but the CEO says the company should reach profitability next year. Bloomberg Boot Camp, I'm Fred Fishkin.