- Ocado’s U.S. partner Kroger orders advanced automated technologies for its warehouse network, enhancing efficiency and productivity.
- Technologies include On-Grid Robotic Pick and Automated Frameload, with Ocado’s stock showing partial recovery after recent setbacks.
OUR TAKE
Ocado’s new partnership with Kroger provides a crucial boost after Sobeys halted its warehouse launch, causing Ocado’s shares to drop. Kroger’s adoption of Ocado’s advanced technologies, like On-Grid Robotic Pick (OGRP) and Automated Frameload (AFL), reaffirms the value of its innovations. Despite this positive development, Ocado must innovate and diversify to ensure sustained growth and investor confidence.
–Jasmine Zhang, BTW reporter
What happened
Ocado‘s U.S. partner Kroger has placed an order for new automated technologies to enhance its warehouse operations, giving Ocado a significant boost after setbacks with its Canadian partner Sobeys.
The technologies include On-Grid Robotic Pick (OGRP) and Automated Frameload (AFL), which will be deployed across existing and future customer fulfilment centres (CFCs). OGRP involves robotic arms that pack groceries, while AFL automates the loading of delivery frames. These innovations aim to improve efficiency and labour productivity.
Despite Ocado’s stock being down 45% year-on-year, recent developments and increased annual guidance have partially recovered investor confidence.
Also read: Ocado says cash flow is improving despite robot warehouse delays
Also read: Ocado and Aeon to build third robotic warehouse in Japan
Why it’s important
Ocado’s recent partnership expansion with Kroger couldn’t have come at a better time. After Sobeys halted the launch of a new warehouse and ended their exclusive partnership, Ocado’s shares plummeted, reflecting investor anxiety about its growth prospects. The new order from Kroger is a much-needed boost, signifying confidence in Ocado’s technology and potential for future growth.
Kroger’s decision to implement Ocado’s latest automated technologies, such as the OGRP and AFL, across its warehouses highlights the enduring value of Ocado’s innovations. This deal not only rejuvenates Ocado’s market standing but also underscores the increasing importance of automation in the retail sector.
However, Ocado’s future remains precarious. The competitive landscape and recent financial setbacks call for a strategic reassessment. While Kroger’s order offers a reprieve, Ocado must continue innovating and diversifying its client base to sustain long-term growth and investor confidence.
