Kroger Thinking Smaller With 3 New Ocado Facilities

Kroger Thinking Smaller With 3 New Ocado Facilities
So far, none of Kroger's planned customer fulfillment centers, currently being constructed in partnership with Ocado, has gone live.

The Kroger Co. and U.K. grocery e-commerce provider Ocado are continuing to expand their partnership with three new customer fulfillment centers (CFCs) slated for the Great Lakes, Pacific Northwest and West regions – all of them smaller than initial sites, and all before the companies’ collaboration has even gone live.

“Kroger is incredibly excited to construct three additional industry-leading customer fulfillment centers across the country in relationship with Ocado to bring fresh food to our customers more conveniently than ever before,” noted Robert Clark, SVP of supply chain, manufacturing and sourcing at Cincinnati-based Kroger. “Through our strategic partnership, we are engineering a model for these regions, leveraging advanced robotics technology and creative solutions to redefine the customer experience.”

The CFC model, which incorporates cutting-edge automation and artificial intelligence, will be leveraged to expand Kroger products to a larger footprint.

In contrast to the partnerships' earlier sites, which have been in the 350,000-square-foot range, the West facility will measure 300,000 square feet, the Pacific Northwest facility will measure 200,000 square feet, and the Great Lakes facility will measure 150,000 square feet; these varying sizes illustrate the flexibility of Ocado’s fulfillment ecosystem to best serve each market. When up and running, the facilities will collectively create 1,000-plus new jobs, with the potential for hundreds of further career opportunities.

According to the companies, they will divulge the exact locations of the new facilities soon.

“Kroger and Ocado are building an ecommerce ecosystem across the U.S. that will deliver unrivalled online experiences to more customers, in more ways and in more markets," said Ocado Solutions CEO Luke Jensen. “Spanning a range of automated CFC sizes, these three new sites will be key parts of this growing and flexible fulfillment network. Alongside the scale and wider benefits of larger CFCs, smaller-format and mini CFCs will allow Kroger to reach more geographies with Ocado’s automation, while also catering to a wide range of options for delivery.”

The three latest locations will complement Kroger’s previously revealed CFC sites in Monroe, Ohio; Groveland, Florida; Fredericksburg, Maryland; Atlanta; Dallas; and Pleasant Prairie, Wisconsin. The Monroe facility – the country’s first CFC, according to the grocer – is scheduled to make its official debut in early 2021.

Kroger and Ocado first teamed up in May 2018, and since that time have begun construction on the Ohio and Florida CFCs.

Cincinnati-based Kroger employs nearly half a million associates who serve 9 million-plus customers daily through a seamless digital shopping experience and 2,757 retail food stores under a variety of banner names. The company is No. 3 on The PG 100, Progressive Grocer’s 2020 list of the top food retailers in the United States.

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