The Impact of E-Business on Ocado

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EXECUTIVE SUMMARY

This research study si an attempt to study the impact that e-busienss has on Ocado. Ocado is an online business; it has also launched iPhone, iPod touch, iPad and Android device applications, which are most convenient way to shop for groceries. People do not require desktop PCs or laptops to shop online; they can use their phones to shop for groceries. Ocado allows its customers to price match with other main grocery stores in the UK. Ocado has launched online price match with its competitor store Tesco. Ocado is one of the rapidly growing online businesses in the UK with delivery area expanded to cover over 10 million households. Ths research study has carried out a ratio analysis in order to assess the performance of Ocado after implementing the e-business strategies. Ocado is has been giving tough competition to the supermarkets such as Tesco. Therefore, Ocado has successfully implemented e-busienss there are fthermroe improvements that needs to be made by the com apny its self.

TABLE OF CONTENTS

EXECUTIVE SUMMARYII

LIST OF FIGURESV

CHAPTER 01: INTRODUCTION1

1.1. Background of the Study1

1.2. Company and Industry Profile3

1.3. Aim and Objectives4

1.4. Research Questions4

1.5. Significance of the Study5

1.6. Limitations of Analysis5

1.7. Layout of the Dissertation6

CHAPTER 02: LITERATURE REVIEW8

2.1. Introduction8

2.2. Historical Perspective of E-business8

2.3. E-commerce Implementation Strategy10

2.4. Benefits of E-Business11

2.5. E-Business Models12

2.5. Ocado's Competitiveness13

CHAPTER 03: METHODOLOGY16

3.1. Introduction16

3.2. Data Collection16

3.3. Sources Used17

3.4. Business and Accounthing techniques19

CHAPTER 04: PRESENTATION AND ANALYSIS22

4.1. SWOT Analysis22

4.2. PEST Analysis27

4.3. Porter's Generic Strategies28

4.4. B2B and B2C29

4.5. Trend Analysis30

4.6. Ratio Analysis34

4.7. Relationship between Ecommerce and Ocado Operations40

CHAPTER 05: CONCLUSION43

REFERENCES46

BIBLIOGRAPHY49

APPENDICES50

LIST OF FIGURES

Figure 1: Online Grocery Shoppers31

Figure 2: Average order size (£)31

Figure 3: Average number of orders/week32

Figure 4: CO2 Emission33

Figure 5: Sales Growth34

Figure 6: Gross Profit Margin35

Figure 7: Net Profit Margin36

Figure 8: Return on Capital Employed (ROCE)37

Figure 9: Current Ratio38

Figure 10: Quick Ratio39

CHAPTER 01: INTRODUCTION

1.1. Background of the Study

Electronic commerce (e-commerce) is generally defined to encompass any commercial activity that uses the transmission of electronic data to facilitate buying and selling. E-commerce therefore spans a wide variety of industries, not only those trading in tangible goods (as traditional brick-and-mortar storefronts do) but also those brokering the transfer of intangible ownership rights (Bharadwaj, 2000). It also uses a wide variety of technologies, ranging from the simple buying and selling of products using electronic mail to more complex inventory-tracking systems that automatically replenish stock based on sales. Over the past 10 years, e-commerce has become an integral part of business organization and economic strategy accounting for more than $3.3 trillion worth of transactions in the U.S. economy in 2007. E-commerce is of particular relevance to the study of geography as it enables (though it does not guarantee) change in the spatial organization of the economy. This entry reviews how e-commerce can help overcome the frictions of geographical distance while operating as a centralizing force throughout the global economy.

As e-commerce and other information technologies became more widely available, many observers predicted the “death of geographical distance,” a concept that gripped both the popular and the policy ...