Profit Calculation You open up a grocery delivery startup. The start-up partners with a local...
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Profit Calculation You open up a grocery delivery startup. The start-up partners with a local grocery store and delivers groceries to your customers on-demand through orders placed through an app. The first year of business was successful and you are looking to grow your business a.) Determine the total annual profit given the below information. Profit Structure Fee Revenue Annual Membership Fee Delivery Fee (per order) $50 $5 Grocery Revenue Mark-up (per order) 20% Costs Driver Compensation App Maintenance $15/hour $50,000/year Demand Number of customers Avg. orders per customer Time per order 1,000 20/year 20 mins Order Breakdown Avg. Order Cost (excl. mark-up) $20 $50 # of Customers 500 500
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