Is it better for WumDrop to invest in developing our own fleet or partnering with more third-party delivery services?

Introduction

The key trade-off we're examining for WumDrop is whether to invest in developing our own delivery fleet or to expand partnerships with third-party delivery services. This decision will significantly impact our operational model, cost structure, and ability to control the customer experience. I'll analyze this trade-off by considering various factors including business context, user impact, technical feasibility, and resource allocation.

Step 1

Clarifying Questions (3 minutes)

• Based on WumDrop's current market position, I'm thinking we might be facing increased competition. Could you share how our market share has trended over the last 12 months?

Why it matters: Helps assess the urgency of improving our delivery capabilities Expected answer: Slight decline in market share Impact on approach: Would prioritize faster implementation of the chosen strategy

• Considering our user base, I'm assuming we have a mix of individual and business customers. What's the current split between these segments in terms of revenue?

Why it matters: Different customer segments may have varying delivery needs and expectations Expected answer: 60% individual, 40% business Impact on approach: Would influence the flexibility and scalability requirements of our delivery solution

• Looking at our technical infrastructure, I'm wondering about our current capacity for fleet management. Do we have any existing systems that could be adapted for managing our own fleet?

Why it matters: Affects the feasibility and cost of developing our own fleet Expected answer: Basic tracking system in place, would need significant upgrades Impact on approach: Would impact the timeline and resource allocation for the in-house fleet option

• Regarding our financial position, I'm curious about our current profitability and available capital for investment. What's our EBITDA margin, and do we have a dedicated budget for this initiative?

Why it matters: Determines our ability to make significant upfront investments Expected answer: Healthy margins, moderate investment budget available Impact on approach: Would influence the scale and pace of implementation for either option