Selection of new sales channel for flower chain

Background

The company is a Danish chain store that sells flowers, flower related products and design products in their stores in Copenhagen and North Zealand. The company found that customers oftentimes wished to buy flowers outside the normal opening hours of their stores.

The company had previously tested a flower vending machine with great success and wanted to expand the concept and hence create a new sales channel.

In relation to this, the company wanted Quorum’s help with exploring and evaluating how they could best expand the concept in the most optimal way, and thereby create a profitable sales channel which could secure a return on investment within 24 months.

Approach

Quorum initiated the project by establishing an overview of possible sales channels, and identified shopping centres, shopping streets, train stations and existing flower stores as the most optimal sales channels.

For each of the four sales channels, Quorum analysed the markets and the costs related to entering the markets and establishing the vending machines.

Based on a market analysis, Quorum created investment scenarios for each of the four sales channels and evaluated the potential return on investment.

Additionally, Quorum advised the company on which sales channel would be the most beneficial to invest in, in order to secure a return on investment within 24 months.

Result

As a result of the project, the company got a comprehensive overview of the sales channels, an overview of possible locations for the flower vending machines and an understanding of the profit potential and likely return on investment of each of the four options.

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