Online Groceries: A Recipe for Success?

It’s just a matter of time until you can buy Alaskan salmon along with my fake Head Porter bags on Taobao. The big-boys of eCommerce, Taobao and Jingdong, haven’t yet made the move to online grocery shopping, but other websites are leading the charge. After a six month test-run, 菜管家 (Cai Guan Jia), the biggest online distributor of organic food, recently claimed they see a huge potential in online grocery shopping. On their website, you can shop for 66 kinds of vegetables, 50+ kinds of meat, and more than 20 kinds of seafood.

The busy and fast paced lives of today’s Chinese youth means they’re looking for an easier, more convenient way to shop. If you’ve ever been to a local Carrefour after 5pm you would understand. It’s utter pandemonium. That’s what Cai Guan Jia is banking on. Chinese youth have already become accustomed to buying just about anything online. Furthermore, many are dissatisfied with take-out food and restaurant food. Others are concerned with food safety. So what do they do if they want to get convenient, fresh and high-quality organic food? The answer may soon be online shopping.

Cai Guan Jia has encountered several obstacles. First off, fresh food is different from other products whose quality can be easily standardized and identified. Consumer’s have their own preference. Therefore, the customers’satisfaction is difficult to manage. Secondly, the market is still young, the demand still small. Generally, people who buy food seldom surf online, while people who surf online seldom buy food. Yet this can change very quickly. If it’s convenient and the price is right, Chinese youth may very well turn to the ‘net to stock up their fridges. Cai Guan Jian has accepted this. Yu Tian, COO of Cai Guan Jian states, “In order to build our brand, we have prepared operate at a loss for 2 – 3 years.”