Monday, October 14, 2013

Leshop: The Most Successful Grocery E-Retailer In The World

I wanted to writte an article about a company I already wrote about, which is a great success on line, Swiss company Le Shop.  In the booming e-commerce, most companies which experience great success sell either cultural goods that can be easilly dematerialize, or companies that sell hardware and electronics. 

But in the world, it is very rare to see food retailers being able to run a profitable business. A lot of companies are looming on the potential, such as Amazon, but even though the business is not that old, some companies have already filed for bankrupcy, like French e-retailer 

The calcul is simple: If on average e-commerce can counts in the end for about 30% of the overall commerce, the growth margin is very high, as I don't know any countries where grocery e-retailing has a market share higher than 10%.

Le Shop is one of them. Founded in 1997, the company struggled in its debut, but was able to go through the Internet bubble of the early 2000s. In 2003, the company set a strategic partnership with Swiss leading company Migros, which allowed them to get the buying terms and the private label catalog. 

In 2013 the company:
  • Generates 31% of its sales on smartphones and tablets
  • Sales for 122 M€
  • Counts for 0,8% of market shares.
  • Is profitable.
Of course, the Swiss market may not be the most aggressive in terms of pricing, but Le Shop, thanks to its trailblazer mindset, has been able to develop a good business. Also, Switzerland is probably a great country, as the equipment in smartphones and tablets is probably higher than the world average. There are though probably a lot to learn for competitors in order to launch their business online.