Executive Summary
Purpose: Advances in technology and globalization has made satisfying consumer needs a lot harder, particularly the online supermarket retailers. Lean thinking may be a solution of online grocers to gain competitive advantage. However, due to many disconnects between consumers and online grocers these disconnect/barriers need to be identified. The aim for this report is to identify the barriers of lean principals specifically to the online food market. Furthermore, throughout literature will be reviewed to show these disconnect followed by tailored recommendation online grocers should consider when implementing lean thinking.
Findings: As lean management is rare amongst online grocers and there a many disconnects in implementing
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To gain competitive advantage lean practices such as reducing waste, increasing value for consumers through efficiency resulting in higher revenues has been a great motivator for continuous lean practices (Belavina, Girotra, Kabra, 2016). However, studies show that even though 96% of online Australian which have made online purchases (Nielsen, 2016); that only 1 in 5 online Australian respondents say they’ve bought fresh groceries online (Nielsen, 2016). Although there is growth for online grocers and elements of lean there still seems to be a few disconnects with consumers and their values. Nielsen’s 2016 Global Connected Commerce Report identified that less than 1 in 5 Australians find best grocery deals online, whilst 1 in 3 say online grocery shopping is a time saver and only 1 in 10 believe that the quality of groceries is better found online (Nielsen, 2016). Thus, the main barriers for online grocers are quality, efficiency and cost. Therefore, to effectively implement lean thinking this report will aim to identify the key barriers such as quality control, efficiency and cost. It will discuss it further through thorough literature review and provide realistic recommendations for effectively implementing lean for online food