business news in context, analysis with attitude

The Boston Globe over the weekend reported on the decision by Roche Bros., the 17-unit Massachusetts-based retailer, to launch an online grocery/home delivery service on November 2.

Ed Roche, the company’s COO, tells the Globe that the goal of the service is to win back customers it lost to Ahold’s Peapod e-grocery service, and that he hopes the new venture will generate the revenue of ad additional store. ''The future of the business is going this way," he tells the paper. ''The future of retail is going this way."

The company says that it will fill orders using almost all existing personnel from its existing stores and deliver within a 10-mile radius, reaching 700,000 homes; its one store on Cape Cod is not being included in the initial rollout of the service. The delivery charge is $9.95 per order, regardless of size.

Peapod, by way of comparison, requires a minimum order of $50 and charges $9.95 for orders less than $100 and $6.95 for orders above $100. It covers a broader geographic area in the Boston market than Roche Bros.
KC's View:
Peapod may have a broader reach, but that isn’t the point. Roche Bros. tends to have a very loyal consumer base, so offering these dedicated customers yet another way to obtain products is a sensible and prudent decision.

Ed Roche is right. The future of retail is to offer customers the products they want, where they want them, how they want them, when they want them, with a price/value equation that they believe is appropriate.