Is Lidl GB the ‘fast growing European retailer’ signing on for a new Ocado Group automated CFC?
Earlier this week, we reported that Ocado Group is to build a large customer fulfilment centre for a "fast growing European national retailer". Ocado will install its latest technology into the facility and it is due to go live in FY28.
The company has taken the final unit at Indurent Park Stoke Central, a 530,000 square foot industrial and logistics space on the 300-acre Festival Park development in Stoke-on-Trent. The site will be equipped with Ocado’s Re:Imagined technology suite, including the 600s bot, On-Grid Robotic Pick (OGRP), and a fully automated freezer.
Plans are afoot for the unnamed retailer to quickly transfer its existing online order volumes into the CFC, with the site expected to go live with utilisation at just over half of its design capacity.
All of which begs the question, who exactly is the fast growing European national retailer? Well, let’s run through the clues scattered throughout Ocado Group’s press release covering the new CFC.
The retailer must be a big hitter if it’s able to line up a shiny new automated fulfilment centre.
It has already built a sizeable online grocery business, bearing in mind Ocado’s note that existing volumes will be transferred into the facility.
It is fast growing.
The warehouse will open at just over half of its design capacity, so significant growth is on the cards.
Based on the above, some industry observers have put the spotlight on Lidl GB. The German discounter has been giving the big four in the UK a run for their money in the bricks and mortar space and it recently overtook Morrisons to become the fifth largest supermarket in Great Britain.
Twenty five years ago, it could only lay claim to 1.4% of the grocery market, behind long gone names such as Safeway, Somerfield and Kwik Save. Since then it has rapidly opened stores across the country and today has over 35,000 employees, 970+ stores and 14 distribution centres in England, Scotland and Wales.
Whilst its business model has traditionally focused on low cost, in-store shopping, the new CFC would enable it to broaden its appeal as it increasingly becomes more of a weekly shopping destination. It previously ditched online delivery plans, stating that it couldn’t find a solution suitable for its low cost model. However, it is now taking a major step in the opposite direction with the launch of a Click & Collect pilot project in Ireland.
Agree or disagree that Ocado Group has inked a deal with Lidl GB? Is it another European retailer in your opinion? Let us know your thoughts in the comments section below 👇
Asda
In May, Ocado Group and Asda announced a partnership to develop the former’s online business across the UK with the Ocado Smart Platform. The focus of the tie up will be to quickly replace and upgrade Asda’s existing e-commerce infrastructure, with Ocado’s solutions to be rolled out across both stores and dark stores from 2027.
The pair plan to deploy Ocado’s end-to-end solutions across Asda e-commerce operations. These include Ocado’s front-end (webshop), In-Store Fulfilment, and software to support last mile planning and route efficiency. Go live is set for early 2027. Using Ocado’s Smart Platform, Asda say it will be able to offer a full range of online services, including scheduled and short lead-time orders, as well as Click & Collect. It will also use the platform to fulfil and deliver orders placed through aggregator platforms such as Uber Eats, Deliveroo, and Just Eat.
Steiner said: “We’re delighted that Asda has chosen Ocado to support the next phase of their online growth. The UK remains one of the world’s most competitive and fast evolving online grocery markets, where technology, scale and continuous innovation are increasingly important for retailers looking to maintain leadership positions. “Through this partnership, Asda will be able to deploy a technology platform already processing more than 70 million orders annually worldwide, supporting market leading customer propositions across 11 countries. Asda will also benefit from Ocado’s significantly evolved platform, giving them the flexibility to adapt as the market continues to develop.”
Allan Leighton, Executive Chairman, Asda, said: “We are the cheapest full range supermarket, as consistently shown by independent price comparisons from Which? and The Grocer, and have a large, well established online offer. We know that continued success in this highly competitive market is dependent on providing a positive experience for customers every time they shop. Partnering with Ocado will strengthen our online offer and provide a consistent and high quality experience for millions of shoppers, from order through to delivery, while supporting our formula for growth.”
Asda will be hoping that the move helps it tackle recent sales weakness under its private equity owners, TDR Capital and Mohsin Issa, and fight back against its rivals, including a buoyant Lidl GB. Its UK grocery market share has dropped from 14.3% before their 2021 takeover to 11.5%, according to Kantar data, leaving it just above Aldi on 10.8%.
This and the aforementioned unnamed European deal are also much needed boosts for Ocado Group, which has been ending mutual exclusivity contracts in most of the markets where its automation grocery tech is live, including in the US with Kroger.
