Grocery Enterprise In July 2002, FreshDirect made its first delivery. The online grocer, which began in the New York met

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Grocery Enterprise
In July 2002, FreshDirect made its first delivery. The onlinegrocer, which began in the New York metropolitan area and hasexpanded slowly and cautiously from Brooklyn to Queens toManhattan, now has annual revenues of $150 million. The companydecided to revamp its IT infrastructure focusing on availabilityand scalability to support a new, more aggressive growth strategy.In early 2004, FreshDirect hired a new CTO, Myles Trachtenberg, tohelp expand its business. Trachtenberg led the company through itsIT infrastructure revamp, which was completed September 2004. Thecompany’s growth strategy focuses on using a variety of industrybest practices to succeed. “I like to think of us as three types ofbusinesses pulled together,” Trachtenberg said. FreshDirect hassought to emulate the e-business success of Amazon.com, thejust-in-time manufacturing capabilities of Dell, and thedistribution expertise of FedEx. FreshDirect generates 99 percentof its business through its Web site. To differentiate itself inthe marketplace, the company concentrates on preparation anddelivery of fresh foods, which account for about 70% of sales. WhenTrachtenberg joined FreshDirect, its infrastructure was running onSun Microsystems servers. Trachtenberg wanted to update the systemsto create an infrastructure that would ensure high availability tomeet customer demands for a quick and easy online experience, aswell as the scalability to allow FreshDirect to continue to expand.Trachtenberg also wanted to move to an Intel-based system. KeepingFreshDirect’s Web site operational is essential to the company’sgrowth strategy. The Web site must handle over 4,000 orders a day,each with an average of 30 items, which requires the movement ofabout 1 million items in the warehouse each week. Before the new ITinfrastructure revamp, the average response time on the FreshDirectWebsite was about eight seconds. Today, the response time is twoseconds during peak demand and one second during low demandperiods. Within its data center, FreshDirect runs SAP enterpriseresource planning software and database. Inside the warehouse, eachorder is disassembled for sorting and packing. The order is firstrun through a logistics application by RouteSmart TechnologiesInc., which uses algorithms to divide orders based on destination,delivery schedules, and capacity. How rapidly FreshDirect willexpand its territory has yet to be determined. “There’s still a lotof growth left in the areas we serve now,” Trachtenberg said. “InNew York City alone, I’d say there’s definitely potential forbetween $300 million and $500 million a year.”
Required:
1. What type of technology is FreshDirect using (2 Marks)
2. How could FreshDirect use a kiosk to improve its business (2Marks)
3. How could FreshDirect use m-commerce to improve its business(2 Marks)
4. What are the three different types of service providers andwhich one would FreshDirect use to run its business (2 Marks)
5. What types of information would be contained in FreshDirect’sintranet (2 Marks)