Ocado announces one-hour delivery plans as revenue jumps 40%

Ocado Retail, the joint venture between Ocado Group and Marks & Spencer, saw revenue surge by 40 per cent to £599 million in the 13 weeks to 28 February 2021.

The number of average orders per week grew by 2.5 per cent to 329,000, up by 8,000 orders on the previous year.

The company also announced that alongside opening two standard customer fulfilment centres (CFC) this year, it plans to develop 12 new ‘micro sites’ primarily in London, which will support the roll out of its ‘Ocado Zoom’ within the hour delivery service.

A second mini-CFC will open next year, while the company said progress is being made securing sites for further standard sized warehouses.

The grocery retailer said that a mini-CFC in Bristol has brought customers in the region shorter lead times for delivery and increases order capacity by 30,000

"Over the past year, large numbers of UK consumers have made a permanent shift to online grocery shopping. Ocado Retail is best placed to serve these customers as we continue to improve the customer experience through the joint venture with M&S, adding new products, offering greater value, and maintaining high customer service levels,” said Melanie Smith, Ocado Retail chief executive. “We opened one mini–Customer Fulfilment Centre in Bristol last month, which gives us capacity to serve more customers and with the opening of Purfleet and re-opening of Andover, both later this year, we ultimately expect to ramp our overall capacity by 40 per cent with these sites."

She added: “Q2 2021 represents the one-year anniversary of the start of the Covid-19 pandemic which accelerated the demand for online grocery; while this year's quarterly sales figures will reflect the year-on-year comparisons with periods of full lockdown, we expect strong growth over the coming years as we continue to lead the charge in changing the UK grocery landscape, for good."

Tim Steiner, chief executive of Ocado Group and chairman of Ocado Retail, said: "Over the last twelve months, there has been a dramatic and permanent shift towards online grocery shopping around the world. Millions of customers have experienced online grocery shopping through the pandemic and many of them will not be going back to bricks and mortar. As we progress towards a new normal for grocery retail, and the focus for the industry shifts from meeting unprecedented demand to winning in a large and growing online channel, the need for a fulfilment solution that both delights a more knowledgeable customer, and enables profitable, sustainable growth, has never been more critical.”

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