Bodega is a startup tech company based in the U.S. founded by former Google employees, Paul McDonald and Ashwath Rajan. The business provides smartphone-activated vending machines across the country unique to specific locations. Recently, they launched their first 50 machines and received huge backlash from customers and convenience store owners. I have created a brief business model that will further explain the reasons for this negative feedback.

 

Value Propositions

Bodega values convenience and instant gratification. These are driving forces behind their company. However, they also have a main goal of completely replacing convenience stores.

• Many convenience stores in New York are family-run and started years ago by immigrants; they are an important part of the community

Customer Segments

The company targets a wide variety of people who are busy and need fast and easy access to food, hygiene products, etc.

• The majority of people are satisfied their local convenience shops and enjoy the community aspect

Channels

Their vision is “100,000 Bodegas spread out, with one always 100 feet away from you.”

• This will disrupt business for many local convenience stores

Customer Relationships

Bodega kiosks are to be designed specific to their location, with the “promise that the products will not just be tailored to their general environments — protein bars in the gym, tampons in a sorority house — but to their specific users”.

Revenue Streams

The company earns revenue with their machines which charge customers on credit through their mobile device.

Key Partners

The company has paired up with three main investors: “First Round”, “Forerunner” and “Homebrew”.

Key Activities

The company’s success will come from supplying the public with products they need through their machines and mobile service.

Key Resources

The several thousand machines Bodega intends to build will call for a large amount of employees in charge of packaging products for each location, transporting them, restocking machines as well as fixing any mechanical issues.

Cost Structures

If the company were to build 100,000 machines, that would be “ten million items that are active at a time, plus reserve products for restocking, plus new products to introduce as the “machine learning”…cycles out low performers”. Purchasing these items, bundling them and delivering them to each location will be very costly.

Financial cost is not the only cost associated with this company. Many family-run stores are being and will continue to be put in jeopardy at the cost of these machines. The company’s overall concept has potential. However, before the company can grow, it needs to change its values and direct its main goal away from reshaping the convenience store industry and taking away from community, to something that will add to the communities.

 

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