GOPUFF: IN SEARCH OF PROFITABLE STRATEGIES IN THE
Q-COMMERCE SECTOR CASE STUDY SOLUTION
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SYNOPSIS
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By March 2023, Yakir Gola and Rafael Ilishayev, co-founders and co-CEOs of Philadelphia-based
GoBrands Inc., doing business as Gopuff, are experiencing intense competition from both direct and
indirect competitors in the quick commerce (Q-commerce) industry and exploring the profit feasibility of
the same.2 Gopuff’s model is different than that of Amazon or marketplace companies like Instacart, which
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require days or several hours to make deliveries.3 In 2023, Gopuff is still unprofitable, and it intends to
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achieve profitability by reducing spending, scrapping off its lower-performing warehouses, and
emphasizing higher-margin revenue streams like advertising.4 Do the co-founders have a feasible business
model? Can they make Gopuff earn a competitive advantage over its direct and indirect competitors? What
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strategies can the co-founders consider to make Gopuff financially feasible?
So
OBJECTIVES
• Explore possible sources of competitive advantage using the value chain analysis framework.
• Critically analyze business model challenges using the business model canvas.
• Examine direct and indirect competitors using strategic group analysis.
• Evaluate the attractiveness of an industry using Michael E. Porter’s “Five Forces.”
• Examine the business and corporate strategies that a firm may consider to increase its financial feasibility.
The Case Solution Starts From page 5
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ASSIGNMENT QUESTIONS
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1. Conduct a value chain analysis for Gopuff and identify its competitive advantage.
2. Using the business model canvas, explain to what extent Gopuff has been successful with its business model.
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3. Using strategic group analysis, explain competitive rivalry in the grocery delivery sector.
4. Critically analyze if Gopuff is operating in an attractive industry.
5. What business and corporate strategies can Gopuff consider to make itself financially feasible?
The Case Solution Starts From page 5
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3. Using strategic group analysis, explain competitive rivalry in the grocery delivery sector.
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Strategic group analysis refers to categorizing firms based on their adopted competitive strategies and
identifying direct versus indirect competitors. 75Overall, we can identify three strategic groups in grocery
delivery: Q-commerce, the marketplace model, and e-commerce. We can create a strategic group in the
online grocery industry, using the speed of delivery and warehouse model or vertical integration as the two
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axes (see Exhibit -1).
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Q-commerce
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In the grocery delivery sector, Q-commerce companies like JOKR have a unique selling proposition of
order delivery in 15 minutes or less, with no order minimums.76 JOKR has also expanded internationally,
So
mainly in the Brazilian market, and within the US, it is predominantly present in New York and Boston.77
Getir, a Turkish startup, offers grocery delivery in a 10-minute time window.78
Marketplace Model
The marketplace model is asset-light and has no inventory risk and much faster scalability than Q-
commerce companies, which are asset-heavy because they need to establish MFCs.79 However, the
marketplace model also implies less control over quality and service, as companies rely more on third
parties for user experience with consumer products.80 Delivery fees of Q-commerce companies are less than
those of marketplace model companies. For example, Gopuff charges a delivery fee of $1.95, while Shipt,
Target’s online same-day delivery platform, charges $7 per delivery; DoorDash and Grubhub charge $5.99
The Case Solution Starts From page 5
, EXHIBIT -1: STRATEGIC GROUPS IN GROCERY DELIVERY
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The Case Solution Starts From page 5
Q-COMMERCE SECTOR CASE STUDY SOLUTION
e
pl
SYNOPSIS
m
Sa
By March 2023, Yakir Gola and Rafael Ilishayev, co-founders and co-CEOs of Philadelphia-based
GoBrands Inc., doing business as Gopuff, are experiencing intense competition from both direct and
indirect competitors in the quick commerce (Q-commerce) industry and exploring the profit feasibility of
the same.2 Gopuff’s model is different than that of Amazon or marketplace companies like Instacart, which
n
require days or several hours to make deliveries.3 In 2023, Gopuff is still unprofitable, and it intends to
tio
achieve profitability by reducing spending, scrapping off its lower-performing warehouses, and
emphasizing higher-margin revenue streams like advertising.4 Do the co-founders have a feasible business
model? Can they make Gopuff earn a competitive advantage over its direct and indirect competitors? What
lu
strategies can the co-founders consider to make Gopuff financially feasible?
So
OBJECTIVES
• Explore possible sources of competitive advantage using the value chain analysis framework.
• Critically analyze business model challenges using the business model canvas.
• Examine direct and indirect competitors using strategic group analysis.
• Evaluate the attractiveness of an industry using Michael E. Porter’s “Five Forces.”
• Examine the business and corporate strategies that a firm may consider to increase its financial feasibility.
The Case Solution Starts From page 5
, e
pl
m
Sa
n
tio
ASSIGNMENT QUESTIONS
lu
1. Conduct a value chain analysis for Gopuff and identify its competitive advantage.
2. Using the business model canvas, explain to what extent Gopuff has been successful with its business model.
So
3. Using strategic group analysis, explain competitive rivalry in the grocery delivery sector.
4. Critically analyze if Gopuff is operating in an attractive industry.
5. What business and corporate strategies can Gopuff consider to make itself financially feasible?
The Case Solution Starts From page 5
, e
pl
m
3. Using strategic group analysis, explain competitive rivalry in the grocery delivery sector.
Sa
Strategic group analysis refers to categorizing firms based on their adopted competitive strategies and
identifying direct versus indirect competitors. 75Overall, we can identify three strategic groups in grocery
delivery: Q-commerce, the marketplace model, and e-commerce. We can create a strategic group in the
online grocery industry, using the speed of delivery and warehouse model or vertical integration as the two
n
axes (see Exhibit -1).
tio
Q-commerce
lu
In the grocery delivery sector, Q-commerce companies like JOKR have a unique selling proposition of
order delivery in 15 minutes or less, with no order minimums.76 JOKR has also expanded internationally,
So
mainly in the Brazilian market, and within the US, it is predominantly present in New York and Boston.77
Getir, a Turkish startup, offers grocery delivery in a 10-minute time window.78
Marketplace Model
The marketplace model is asset-light and has no inventory risk and much faster scalability than Q-
commerce companies, which are asset-heavy because they need to establish MFCs.79 However, the
marketplace model also implies less control over quality and service, as companies rely more on third
parties for user experience with consumer products.80 Delivery fees of Q-commerce companies are less than
those of marketplace model companies. For example, Gopuff charges a delivery fee of $1.95, while Shipt,
Target’s online same-day delivery platform, charges $7 per delivery; DoorDash and Grubhub charge $5.99
The Case Solution Starts From page 5
, EXHIBIT -1: STRATEGIC GROUPS IN GROCERY DELIVERY
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The Case Solution Starts From page 5
