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Bain Medium Market Entry Business Strategy Capability Assessment

Distero Dilemma

#Retail #Grocery Distribution #E-commerce
ProHub Comment

This case tests the candidate's ability to evaluate a new business opportunity through market sizing, stakeholder analysis, and capability assessment. The structure guides candidates from assessing market attractiveness through identifying execution risks (particularly last-mile delivery), requiring both quantitative and qualitative reasoning.

Estimated Time 15 minutes
Difficulty Medium
Source Darden
50 / 100
Our client, Distero, is a large grocery distributor based out of the US. As a result of the COVID-19 pandemic, Distero identified that its customers, US grocery stores, have had significantly increased grocery deliveries to end consumers. Distero is bringing in our team to investigate whether they can, and should, offer direct to consumer (DTC) e-commerce grocery delivery. How would you advise our client?

Clarifying Information

  1. What is the grocery industry value chain? The grocery value chain is largely a “three tier” system whereby food producers sell to distributors who subsequently sell to retail locations primarily restaurants and grocery stores.
  2. Does our client have any experience with e-commerce? Our client has an existing e-commerce platform that it uses for its current customers (grocers) to purchase goods for delivery.
  3. What is the client’s objective? Our client is seeking incremental margin in any way shape or form.
  4. What is our client’s current footprint? Our client has significant penetration throughout the US, but not internationally.