Online grocery delivery is an idea whose time has come — but unfortunately, no one has been able to pull it off successfully (yet?). Try as they might, no company has become a clear, across-the-board leader in this market. WebVan was one of the first in a long line of businesses to attempt it and fail miserably.
WebVan's missteps could have been cut and pasted from any laundry list of business catastrophes of the time. Misguided spending was a major one: The company famously invested $1 billion in infrastructure before it had a fraction of the customer demand and orders to justify it. Management had almost no supermarket experience. The grocery business operates on notoriously tiny margins, and WebVan burned through its capital in a flash trying to expand into too many markets. In less than two years WebVan went from 4,500 employees to liquidation [source: Kingsbery].
Online grocery delivery services have been successful for years in very specific markets like Manhattan, with its extremely dense population, a large portion of which does not own a car. The rest of us will just have to wait patiently for the long-anticipated market savior to arrive.