With a tiny margin, if you add any kind of an extra expense, you will run a loss. That is what happens on the web. Peapod, HomeGrocer, Webvan and others are trying to enter this market with home delivery of groceries. It is a wonderful idea, but they will all fail. Because there is not enough margin to make long term profits even a remote possibility.
People have to eat, but they don t have to buy groceries on the web.
Somehow you have to add the cost of taking orders on the web, picking, boxing and home delivery of the products to the regular cost of the products, and make at least as much profit as the supermarkets who do not have these extra costs. It cannot be done. What s more, supermarkets count on impulse buying for a substantial portion of their sales. Everyone buys other stuff that they see as they walk through the aisles. That does not necessarily happen on the web.