Kroger has expanded its partnership with Ocado, and will build a customer fulfillment center (CFC) in the U.S. southern region while also collaborating with Ocado on in-store fulfillment capabilities with a planned rollout across Kroger stores, beginning in 2021.
"Kroger continues to accelerate the expansion of our national network to redefine the customer experience," said Gabriel Arreaga, Kroger's chief supply chain officer. “Our partnership with Ocado is and will continue to be rooted in our ability to deliver a value-added customer-centric solution that brings fresh food to customers through our seamless ecosystem."
The new facility will measure 200,000 square feet. The exact location and construction dates of the new facility will be announced soon, the food retailer said.
Kroger partnered with Ocado to help accelerate its ability to provide customers with anything, anytime, anywhere through its seamless ecosystem. The CFC model — incorporating state-of-the-art automation and artificial intelligence (AI) — will be used to expand Kroger products to a larger footprint.
"In the long term, we know that winning online in grocery means having the best customer service, underpinned by the best operational economics," said Luke Jensen, CEO of Ocado Solutions. "In leveraging the wide range of Ocado fulfillment technologies, Kroger is accessing the best customer offering for online grocery in the world, proven in the U.K., one of most developed and competitive markets for grocery online."
The newly named location will complement Kroger's previously announced CFC sites in Monroe, Ohio; Groveland, Fla.; Frederick, Md; Atlanta; Dallas; Pleasant Prairie, Wis.; Romulus, Mich.; and the Pacific Northwest and West regions. Kroger plans to open the country's first two CFC sites in Monroe, Ohio, a suburb of Cincinnati, and Groveland in early 2021.
As part of its accelerated growth plan, Kroger is also investing and innovating to optimize in-store fulfillment technology and processes. Through their expanding partnership, Kroger is also collaborating with Ocado to leverage their in-store fulfillment capabilities with the best of Kroger's technology and digital solutions to support the rapid growth of pickup demand across Kroger stores nationwide. Ocado's in-store fulfillment solution includes proprietary software that supports associates' efforts to assemble orders and makes it easier and more efficient for them to find products when fulfilling customer pickup orders.
"Kroger continues to accelerate the development and rollout of customer-centric technology and digital capabilities to build a seamless ecosystem that combines the best of the physical store experience with the digital experience," said Yael Cosset, Kroger's chief technology and digital officer. "Ocado's in-store fulfillment capabilities, leveraging AI, will further contribute to continuous improvement of the customer pickup experience."
Cincinnati-based Kroger employs nearly half a million associates who serve 9 million-plus customers daily through a seamless digital shopping experience and 2,800 retail food stores under a variety of banner names.