Honestbee: Adding a brick and mortar store to its online business

• Main Authors: TAN, Wee Liang, GOMULYA, David, CHAN, David, Chan, Chi Wei
• Format: text
• Language: English
• Published: Institutional Knowledge at Singapore Management University 2021
• Subjects: E-commerce; Omni-channel; Brick and mortar; Consumer behaviour; Technological innovation; Service expansion; E-Commerce; Technology and Innovation
• Online Access: https://ink.library.smu.edu.sg/cases_coll_all/388; https://smu.sharepoint.com/sites/admin/CMP/cases/SMU-21-BATCH%20%5BPDF-Pic%5D/SMU-21-0032%20%5BHonestbee%5D/SMU-21-0032%20%5BHonestbee%5D.pdf?CT=1635306046864&OR=ItemsView
• Institution: Singapore Management University

In January 2019, Raymond Holmes, head of the Singapore Association of Chief Marketing Officers (CMO), an informal roundtable of CMOs from multinational corporations, went to explore Habitat, a hi-tech grocery store by Honestbee, a food and grocery delivery company. The advent of e-commerce allowed consumers to buy products online. Asset-light retailers had cost advantages over physical stores when it came to rental expenditure and inventory storage. Honestbee pioneered the food concierge service in Singapore, helping busy consumers fulfil and deliver online grocery orders from partners that had physical stores. Three years after its founding, the company added a physical storefront that aimed to be a lifestyle destination with a grocery store and other dining concepts. The futuristic store would also attract non-shoppers to the area. Holmes wondered if Honestbee’s multichannel approach would provide a better experience for the consumers and enhance its profitability. This case can be used in entrepreneurship, innovation and strategy classes. The case enables a discussion of retail strategy (experience versus online), growth strategy for a start-up, and vertical integration. Students will learn about how Honestbee operated its online service and how adding a physical storefront would help attract new business. It permits an evaluation of an omni-channel strategy in the context of a retail venture, the advantages of e-commerce versus offline retail, and options open for expansion.