This newspaper quote from Fresh-direct co-founder Jason Ackerman was so amusingly cheeky that I made a note to give the online grocer a call: "For the most part the demand has been greater than our ability to supply," Ackerman told the Associated Press earlier this year. "When you deliver great food people love the convenience of it. If we delivered crappy food people wouldn't be as excited." A bit obvious, perhaps, but it sure explains why CrappyFood.com went belly-up. It also goes a long way toward explaining why online groceries, a market segment given up for garbage not long ago, are today enjoying a second helping of critical acclaim and investor interest. Online food stores still generate less than one-half of 1% of the total revenue in the grocery world, according to Jupiter Research, and won't hit 1% until 2008. But we're talking about a $2.4 billion "niche" that's expected to grow 42% annually between now and then — no small potatoes. New York-based Freshdirect claims 100,000 active customers after a mere two years of pushing produce in the Big Apple.
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