Ocado online grocery revenue soared by 35% in 2020 to $2.2bn

By Robert Scammell

Online supermarket and logistics company Ocado Group saw its online grocery revenue grow by 35% to $2.18bn in 2020 thanks to an ecommerce boom driven by the Covid-19 pandemic.

The UK firm’s retail division, Ocado Retail, has no physical stores and delivers food from its warehouses where the logistics are carried out using Ocado’s in-house technology solutions.

Ocado also leases out its warehouse technology to other retailers. Invoices for its UK solutions and logistics totalled £654.3m for the year, a 13.6% year-on-year increase.

In 2020 Ocado pushed into new international markets, opening its first customer fulfilment centres for Sobeys in Canada and Casino in France.

These international solutions, a new growth area for Ocado, brought in revenue of £16.6m.

Total revenue across the Ocado Group came to £2.33bn.

Ocado’s overall 2020 earnings before interest, taxes depreciation and amortisation came in at £73.1m.

However, the company continues to run at a loss, with costs of £104.56m associated with “exceptional” costs pushing overall 2020 losses to £44m before tax.

Despite these additional costs, Ocado shrunk its losses from £214.5m in 2019.

“The rapid acceleration of many pre-existing trends in business and society has been a feature of the Covid-19 crisis and the dramatic channel shift in grocery is a clear example of this. The landscape for food retailing is changing, for good,” said Tim Steiner, CEO of Ocado Group.

“As we look ahead to a post-vaccine world and a return to a new normality, Ocado Group is very well placed to enable our grocery partners worldwide to bring the best customer experience to market, responsibly, with high levels of hygiene and superior, sustainable, and proven economics.”

Last year Ocado entered a partnership with British Supermarket chain Marks & Spencer to deliver its grocery products.

Eloise Shuttleworth, senior director of customer success at growth marketing platform Iterable said: “Ocado’s success is a story of customer experience married to cutting-edge technology. Users have flocked to its offer of convenient delivery of high-quality groceries, with increasing numbers relying on it as a safer way of shopping during the pandemic.”

“Ocado has kept up with customer demand, in part, thanks to innovative AI systems that enable a fully automated, scalable warehouse operation. Intelligent data analytics has allowed it to double down on personalisation, providing an immersive, bespoke browsing experience to suit consumer needs every time they visit.”

Read more: Delivery drones won’t be a reality “anytime soon”: Ocado CTO


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