Ocado has announced that retail revenue soared by 40% in its first quarter ended 28 February 2021, amid a “dramatic and permanent” shift towards online shopping in light of the pandemic.
Average orders per week were up by 2.5% against the first quarter of 2020, while the average order size was £147, in light of seasonal strength over the festive period and a temporary reversal of the trend towards normalised shopping behaviour as the UK entered a third national lockdown.
In the same period, its Erith Customer Fulfilment Centre (CFC) capacity ended the quarter at 150,000 orders per week, whilst a go-live of its first mini CFC in Bristol has brought local customers shorter lead times for delivery and opens up 30,000 orders per week more capacity.
The group plans to open two standard sized CFCs in FY21, in addition to its first mini CFC, while a minimum of 12 new micro sites are being sought, primarily in London, to support the roll-out of the Ocado Zoom immediacy concept which offers deliveries within one hour of ordering.
Melanie Smith, Ocado Retail’s CEO, said: “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.
“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, CEO of Ocado Group and chairman of Ocado Retail, added: “Over the last 12 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.”