Morrisons makes distribution changes as Amazon partnership expands

UK grocer Morrisons has appointed third party logistics provider Wincanton to support its distribution network.

Wincanton will deliver goods from three of the supermarket chain’s distribution centres to stores across the country, after securing a five-year contract. The logistics company will also be responsible for vehicle maintenance through its fleet management business, Pullman Fleet Services, at five Morrisons sites.

Adrian Colman, CEO of Wincanton, promised “high quality operations of scale that can be flexed to support our customers in a competitive industry”.

The new partnership comes as Morrisons announced it is expanding the ‘Morrisons at Amazon’ store on Prime Now to more cities across the UK.

‘Morrisons at Amazon’, a rapid same-day delivery service, is currently available to Amazon Prime Now customers in Leeds, Manchester, Birmingham, and parts of London and the home counties, but in 2019 it will expand to Glasgow, Newcastle, Liverpool, Sheffield and Portsmouth.

Customers using the service can complete a full Morrisons shop online, which is then picked at a local store but delivered by Amazon. One-hour delivery is one of the options offered through this partnership.

As part of the new arrangement, Morrisons will become a retailer on Amazon’s Prime Now website and app. The grocer will continue as a wholesaler for all Amazon’s other UK grocery offers for customers.

David Potts, CEO at Morrisons, said his company’s “conveniently located” supermarkets and Amazon’s “very popular website and customer offer” constitute a suitable combination for grocery shoppers.

“Amazon has been a valued partner of Morrisons for over three years, and we are pleased to be expanding our relationship together,” he explained.

“Continuing to partner with the best digital operators such as Amazon is a significant, capital light growth opportunity for Morrisons.”

Morrisons’ strengthened ties with Amazon come a month after Ocado – the online grocer which Morrisons also uses to operate its eCommerce proposition and fulfil web orders – agreed to allow the supermarket to work more deeply with other providers.

The change in structure of their relationship, which opens up new partnership options with the likes of Amazon and Deliveroo, was partly prompted by Ocado needing to take back UK warehouse space previously dedicated to Morrisons. The extra capacity was required to serve Ocado's other customers, after its Andover warehouse was destroyed in a fire earlier this year.