Why web grocers are playing it cool

Web grocers such as Peapod, FreshDirect Inc. and others are growing because they’re learning a cold, hard fact of life in the online food and beverage business: maintain a frigid supply chain.

FreshDirect, No. 55 in Internet Retailer`s Top 300 Guide to online retailers, for instance, maintains 12 different temperature zones to accommodate the cold storage needs of merchandise ranging from produce to seafood at its 300,000-square-foot distribution center in Long Island City, NY. The company also deploys specially developed printers from Zebra Technology capable of handling extremely cold temperature ranges to expedite order processing and keep perishable items fresh.

The printers are linked to the company’s enterprise resource planning system and programmed to print ready-to-stick labels with the individual product name and description, regulatory information and its own bar code, which expedites order processing. The printing equipment must work in FreshDirect’s constant 38 degrees working environment and in colder departments such as frozen dairy products.

“The constant temperature and the ranges we use in specific departments are a key component of our supply chain, and how we deliver on our promise of delivering fresh food at great prices,” says FreshDirect president Steve Michaelson.

Web grocers are also extending the cool temperature environment all the way from the warehouse to the customer’s front door—a key component of a business model built on offering fresh groceries and next-day delivery.

Peapod, for instance, which this month is celebrating its 15th anniversary, assembles all orders and then packs them in special temperature-controlled bags and crush-proof containers. Marc van Gelder, until today Peapod`s CEO, says the company’s “Stay Fresh” delivery system exceeds fresh food safety standards and maintains products at their optimum temperature from the distribution center to the customer’s door.

“Our warehouses and warerooms maintain different climate zones for each food category,” van Gelder says. “It is quality assurance that frozen items like ice cream will arrive rock hard, but that delicate perishables like produce won’t.”