Is it better for Sky.Garden to invest in faster delivery times or expand to new geographical areas?

Introduction

The trade-off we're examining today is whether Sky.Garden should invest in faster delivery times or expand to new geographical areas. This decision is crucial for the company's growth strategy and resource allocation. I'll analyze this trade-off by considering the business context, user impact, technical feasibility, and potential outcomes. Let's start by clarifying some key aspects of the situation.

Step 1

Clarifying Questions (3 minutes)

• Context: I'm assuming Sky.Garden is an e-commerce platform operating in specific regions. Could you confirm the current geographical coverage and primary markets?

Why it matters: Helps understand the baseline for expansion and current delivery capabilities. Expected answer: Operating in major urban areas of East Africa. Impact on approach: Would influence the potential for expansion and delivery optimization.

• Business Context: Based on the trade-off presented, I'm thinking revenue growth is a key priority. How does Sky.Garden's current revenue model balance between transaction fees and delivery charges?

Why it matters: Helps prioritize which option aligns better with the current business model. Expected answer: Majority of revenue from transaction fees, with delivery as a secondary income stream. Impact on approach: Would influence whether faster delivery or expansion is more likely to drive revenue growth.

• User Impact: I'm assuming customer satisfaction is tied to delivery speed. What's the current average delivery time, and how does it compare to customer expectations?

Why it matters: Helps quantify the potential impact of improving delivery times. Expected answer: Current average is 2-3 days, with customers expecting 1-2 day delivery. Impact on approach: Would determine the urgency of improving delivery times versus expanding reach.

• Technical Feasibility: Considering the potential for expansion, how scalable is Sky.Garden's current technical infrastructure?

Why it matters: Assesses the ease of expanding to new areas versus optimizing existing operations. Expected answer: Infrastructure is moderately scalable but would require some investment for significant expansion. Impact on approach: Would influence the timeline and resource allocation for either option.

• Resource Allocation: Given these two options, what's the current split of resources between logistics optimization and market expansion initiatives?

Why it matters: Helps understand the current organizational focus and potential for reallocation. Expected answer: 70% on logistics optimization, 30% on market expansion planning. Impact on approach: Would indicate the ease of shifting focus to either option based on existing capabilities.