UNFI, MTHR Team Up in Retail Web Effort
Published: Sunday, October 01, 2000
For a $400 start-up fee and a monthly payment of $295, the company is offering its more than 6,500 customers their own URL and full-service, turnkey Web site hosted by MotherNature.com.
“To do something this sophisticated yourself—as an individual retailer—would be cost
prohibitive,” says Dan Atwood. UNFI VP Michael Barach,
MotherNature.com president and CEO, seconds this notion. He says his company raised
$113 million and spent years developing its site.
Retailers must sign up for a minimum of six months to receive the service.
Although MTHR will supply retailers with technical development, order fulfillment, customer service and access to its 16,000 natural and organic products, the company will remain anonymous to the customer.
“There will be no reference to MotherNature whatsoever on the Web site,” Atwood says. “Consumers will log onto the site and see the individual store’s name, logo, mission statement, philosophy, welcome message and in-store specials. It will be 100% each unique store’s Web site.”
When developing its Internet strategy, Atwood says UNFI had two goals in mind: draw customers into the retail store with regular e-mails announcing sales and store events and attract consumers who prefer to place orders from home.
“The e-commerce business will not replace bricks-and-mortar stores,” Atwood says. “It will, however, attract that component of the customer base that enjoys ordering online.”
Although Atwood declined to disclose the terms of his company’s agreement with MotherNature.com, he did say that United is offering the service with no capital investment—a detail that no doubt has earned kudos from industry analysts.
“I think [the strategy] positions United to take advantage in any growth that MotherNature experiences over the next few months with minimal risk,” says Carole Buyers, VP at Tucker Anthony Cleary Gull.
Adams, Harkness & Hill analyst Scott Van Winkle says MTHR’s association with United Natural Foods isn’t likely to affect its slumping stock price, which on Sept. 22 closed at $.91/share. However, he did credit the strategy for inadvertently driving new business to MotherNature.com.
“We hope to make money,” Barach says. “We’re taking what we already built over the last two and a half years and reselling our intellectual property through UNFI.”
According to Barach, MTHR will be paid a monthly fee by UNFI for its services.
UNFI isn’t releasing sales projections on its Web strategy but says it has high hopes for it.
“We succeed when our retailers succeed,” Atwood says. “This service is a new way of [helping them do] precisely that.”