Kroger to expand delivery capabilities with new fulfillment centers
To meet growing delivery needs, Kroger, the country’s largest grocery retailer, is expanding with new fulfillment centers. The company shared its plans to add facilities in two of the largest states, California and Florida, along with entering the Northeast market.
Kroger’s new facilities will be powered by the Ocado Group, a U.K.-based tech company, and will combine vertical integration, machine learning, and robotics to help meet customers’ delivery needs. The news comes after Kroger recently announced a 30-minute express delivery service with Instacart.
The two companies have been working together now on various sites over the last three years, including a facility that opened in Florida this summer.
"Kroger Delivery is a thriving part of our dynamic ecosystem and is transforming grocery e-commerce and meeting a range of customer needs through the introduction of first-of-its-kind technology in the U.S. developed by Ocado," said Rodney McMullen, Kroger's chairman and CEO. "Kroger's growing seamless ecosystem continues to scale, and we're committed to doubling both our digital sales and profitability rate by the end of 2023 and Kroger Delivery will help us reach this target.”
Kroger will expand its existing operations and boost delivery capacity in California with the addition of two fulfillment centers. The medium and smaller-sized facilities will aid same-day and next-day grocery delivery demand. Kroger Delivery launched in Central Florida earlier this year, but will soon expand with two smaller-sized centers in South Florida.
In addition to expanding in those two states, Kroger Delivery plans to create a customer fulfillment center in the Northeast that will meet the needs of same and next-day delivery. Details on the new facilities including customer coverage areas, job creation, facility sizes and timing, are expected in the coming months.
"We feel great about the momentum we're experiencing with Kroger Delivery and our partnership with Ocado and are strategically leveraging our assets to expand our operations in existing regions as well as enter new geographies on the East Coast that leverage facilities across a growing range of sizes," added McMullen.