Kroger partner Ocado unveils new robots and software

The new 600 series warehouse robot from Ocado.

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LONDON — British retail technology company Ocado on Wednesday unveiled a suite of new products aimed at helping major grocery chains take on Amazon and a wave of new fast grocery delivery start-ups.

Although Ocado is best known for its online supermarket, the company’s main focus is on the robotics and automation tools it deploys in warehouses to pick and pack items and prepare them for delivery.

Ocado sells its technology to major retailers, including Kroger, Britain’s Morrisons and France’s Casino.

The company announced two new robots on Wednesday as part of its technology showcase. The first is its 600-series robot, which Ocado says is lighter and more energy efficient than its predecessor, with more than half of its parts 3D printed.

The second is a set of advanced robotic arms that pick items directly from the rack in the company’s warehouses. Ocado says it has developed artificial intelligence technology to improve arm accuracy to something closer to that of human pickers.

Meanwhile, Ocado has also touted what it calls a “virtual fulfillment center” – essentially a combination of software intelligence and small micro-fulfillment centers connected through a single system. Ocado said the offer would maximize the capacity of items in each warehouse while reducing delivery times.

Ocado shares rose more than 5% on Wednesday. The stock has fallen sharply over the past year, dropping 46% as investors fret over high-growth stocks as economies emerge from the Covid-19 pandemic and central banks start talking about tightening. monetary policy.

Quick delivery race

The news comes as retailers face not only competition from Amazon, but also a slew of new entrants offering grocery delivery within minutes. Companies such as Getir and Gorillas have recently sprung up in Europe and parts of the United States, backed by a flood of cash from venture capitalists.

These companies rely on so-called dark stores, tiny warehouses designed to ship orders online rather than serving customers in-store.

Ocado CEO Tim Steiner said he doesn’t believe these fast-paced grocery players pose a significant threat to big retailers.

“There is very little difference between all the players,” Steiner said in a call with reporters on Wednesday. “They are all remarkably similar.”

Some start-ups have recently been acquired by larger players, with Getir buying out UK rival Weezy and Gorillas taking over French company Frichti. The Ocado chief said he was “not surprised” to see consolidation in the sector given how congested it has become.

As for how the company plans to fund the construction of all of its new tech products, Steiner said cost shouldn’t be an issue since the new robots will be more capital efficient than its current models. But he added that the company has enough cash on its balance sheet – as well as access to bank financing – to eventually deploy them at scale.

Ocado plans to roll out the products to its retail partners by the end of 2023. These initiatives are unlikely to have a material impact on Ocado’s full-year 2022 results, the company said.


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