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Ahold Delhaize USA Grows Micro-Fulfillment Capabilities

Ahold Delhaize USA Grows Micro-Fulfillment Capabilities E-Commerce Supply Chain
Ahold Delhaize USA's micro-fulfillment technology pilot employs a Swisslog’s solution including AutoStore tech powered by Swisslog’s SynQ software, as well as Peapod Digital Labs’ proprietary manual picking capabilities.

Peapod Digital Labs, Ahold Delhaize USA’s digital, e-commerce and commercial engine, has launched a micro-fulfillment technology pilot with The Giant Co. in the Philadelphia market. Part of an e-commerce fulfillment center (EFC), the pilot employs a Swisslog solution including AutoStore technology powered by Swisslog’s SynQ software, as well as Peapod Digital Labs’ proprietary manual picking capabilities.

An Ahold Delhaize USA spokeswoman told Progressive Grocer: "The facility is roughly 100,000 square feet. It’s a multiuse facility, and one portion is micro fulfillment. It’s a lab environment that will enable Ahold Delhaize USA companies to test with the technology and evaluate it for other-size spaces."

The pilot rolls out as Ahold Delhaize USA companies continue to expand their e-commerce fulfillment capabilities in support of a stronger omnichannel supply chain.

“Over the past year, all Ahold Delhaize USA companies have seen a tremendous increase in online sales growth, and we believe this growth is here to stay,” said JJ Fleeman, president of Peapod Digital Labs and chief e-commerce officer. “As we think about shifting consumer expectations and the future of omnichannel shopping, we must continue to build and evolve our already strong infrastructure to optimize pickup and delivery. We’re excited to kick off this pilot with The Giant Co. and Swisslog as we continue to build out e-commerce fulfillment capabilities, which we believe will be key in supporting continued omnichannel growth.”

The EFC is planned for the City of Brotherly Love to help meet customer demand in Center City and South Philadelphia. The facility is expected to fulfill about 15,000 online orders weekly for delivery to customers’ homes.

“This pilot is an exciting milestone in The Giant Co.’s omnichannel evolution as we work to transform the online grocery experience for our customers,” said Nicholas Bertram, president of the Carlisle, Pennsylvania-based supermarket banner. “As we continue to see incredible demand for Giant Direct across the Philadelphia region, working with Swisslog to incorporate state-of-the-art technology like AutoStore will not only bolster our overall e-commerce platform for future growth, but also significantly increase our operating capacity, allowing us to deliver a faster, best-in-class experience to more customers each week.”

As noted earlier, the EFC’s hive robotic technology will include the AutoStore storage and retrieval system, powered by Swisslog’s SynQ software and pick stations, as well as Peapod Digital Labs’ proprietary manual picking capabilities. Applying the advantages of the Autostore grid storage density and goods-to-person productivity gains in tandem with Peapod Digital Labs’ picking system will result in streamlined grocery e-commerce order fulfillment.

Ahold Delhaize USA companies will continue other micro-fulfillment tests, including the multi-shuttle pilot with Stop & Shop and Waltham, Massachusetts-based TakeOff Technologies in the Hartford, Connecticut, market. Additional micro-fulfillment pilots will be revealed in the coming months.

Once completed, the EFC will add to Ahold Delhaize USA companies’ growing supply chain. As of March 1, the supply chain will consist of 18 self-managed traditional distribution centers, 28 EFCs and more than 1,100 click-and-collect locations. By 2023, the network is expected to increase to more than 27 distribution centers, with further EFC and click-and-collect growth.

“As we continue to transform the supply chain for the future, we’re doing so with the lens of creating a truly omnichannel supply chain, there for customers whenever, wherever, however they want to shop,” said Chris Lewis, EVP, supply chain for Retail Business Services, Ahold Delhaize USA’s services company. “By 2023, Ahold Delhaize USA companies will be serviced by one of the largest supply chains and private fleets on the East Coast. Continuing to explore ways to maximize the total infrastructure is critical as we create an omnichannel supply chain of the future.”

“Swisslog is excited to work with Peapod Digital Labs and The Giant Co. to leverage automation technology and expand their e-grocery fulfillment capacity to maintain the expectations of their consumers,” said Mitch Hayes, VP of e-commerce and retail, Swisslog, Americas, based in Newport News, Virginia. “For the pilot, we’ve combined AutoStore with our Swisslog SynQ software platform, which has grown to have a very robust set of standard features geared specifically to e-grocery fulfillment. We couldn’t be more pleased to partner with Peapod Digital Labs and The Giant Co., both of which are leading the way in e-grocery fulfillment.”

“Projects like this will change retail forever, and it's an honor to know our proven micro-fulfillment technology is providing Peapod Digital Labs and The Giant Co. with the flexibility to build the infrastructure needed based on space and throughput rates of varying customer demand and order flow,” noted Karl Johan Lier, CEO of AutoStore, which is based in Norway, with U.S. headquarters in Derry, New Hampshire. “We are very pleased that Peapod Digital Labs and The Giant Co. chose AutoStore systems, empowered by Swisslog, to deliver the future of e-grocery.”

Based in Carlisle, Pennsylvania, The Giant Co. is an omnichannel retailer serving millions of customers across Pennsylvania, Maryland, Virginia and West Virginia. It has more than 33,000 associates supporting nearly 190 stores, 132 pharmacies, 105 fuel stations, and 125-plus online pickup hubs and grocery delivery service across hundreds of ZIP codes. The Giant Co. is a company of Ahold Delhaize USA, a division of Zaandam, Netherlands-based Ahold Delhaize and the parent company for Ahold Delhaize’s U.S. companies, including Food Lion, Giant Food, Hannaford, and Stop & Shop, as well as e-grocer Peapod; Retail Business Services, a U.S. support services company providing services to the brands; and Peapod Digital Labs, its e-commerce engine. Ahold Delhaize USA is No. 11 on The PG 100, PG’s 2020 list of the top food and consumables retailers in the United States

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