Quidsi, Diapers.com and $ 500 million of diapers

Bloomberg Businessweek (Oct 11, 2010) has a story about Quidsi, the holding company that owns Diapers.com and Soap.com. The story reports on how a focus on diapers, with low 5-7 % margins, has enabled the company to build a loyal customer base by offering two day delivery for orders above $ 50. It describes a focus on quantitatively measurable metrics, optimized purchasing or items by SKU, synchronized with probabilistic demand forecasts.   The company hopes to sell 100.000 SKUs as it expands.  Can Quidsi manage its supply chain, with free delivery, to build a sustainable business ? Will the 25,000 SKU Soap.com site require different warehouse management skills than the Diaper.co site ? And can the company create algorithms to position its inventory to coordinate supply with impending demand in local regions ? The success of this second wave of ecommerce companies may tell us how parameters have changed in this today’s landscape ? What is Quidsi doing right that the Webvan’s of the past could not manage ? Your thougts.

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About aviyer2010

Professor
This entry was posted in Ecommerce, Operations Management, Supply Chain Issues and tagged , , , . Bookmark the permalink.

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