Kroger Opens First Ocado-Powered Fulfillment Center

Kroger is debuting a customer fulfillment center (CFC), which will combine “vertical integration, machine learning and robotics with affordable, friendly and fast delivery service for fresh food,” according to a press release.

The center will be located in Monroe, Ohio, and powered by Ocado Group, which regularly works with grocery eCommerce, the release stated. The CFC is the first for Kroger, and it will help with “transforming and supporting” the company’s business.

Kroger and Ocado first partnered in May 2018 and introduced to the U.S. new tech focused on proprietary artificial intelligence (AI), advanced robotics and automation. There were also creative solutions explored to help with “seamless and efficient fulfillment, picking and delivery capabilities to provide customers anything, anytime, anywhere and expand Kroger’s reach and products to new geographies,” according to the release.

“[The year] 2020 was a pivotal year for grocery eCommerce, with Kroger’s digital business scaling to over $10 billion — and achieving a record digital sales increase of 116 percent,” said Kroger Chairman and CEO Rodney McMullen in the release. “We’re incredibly proud to achieve this milestone that advances our position as one of America’s leading eCommerce companies. The momentum we’re experiencing is well-timed with the evolution of Kroger Delivery, underpinning the permanent shift in grocery consumer behavior and need for enterprising and modern eCommerce and last-mile solutions — today’s true competitive horsepower.”

Ocado Co-Founder and CEO Tim Steiner said in the release that the partnership “comes against the backdrop of soaring demand for online grocery options in the U.S. and worldwide. In the coming years, we will open more automated CFCs across a range of sizes with Kroger.”

He said the companies also plan to debut components of software solutions in partnership with the Kroger platform to help with curbside orders, according to the release.

“The breadth of this fulfillment ecosystem will be crucial in helping Kroger to continue to win in eCommerce across the U.S.,” he said in the release.

Ocado saw its sales rise 40 percent year over year in the quarter ending Feb. 28, PYMNTS reported, and high numbers of people have indicated they still plan to use online grocery services heavily even once the pandemic is behind us.