Ocado lands major Kroger Smart Platform deal

Ocado has announced an exclusive grocery deliveries deal with Kroger. As a result, the US retailer will use its Smart Platform technology on an exclusive basis Stateside, in return for monthly exclusivity and consultancy fees. Kroger will also take a 5% stake in Ocado as part of the agreement.

The pair are working to identify the first three sites in 2018 for development of automated warehouse facilities. They will pinpoint up to a total of 20 over the first three years of the agreement, with Kroger paying Ocado compensation if it does not commit to the target capacity.

“This is a huge opportunity to redefine the grocery experience of Kroger's customers and create value for the stakeholders of both companies,” says Tim Steiner, chief executive, Ocado. “As we work through the terms of the services agreement with Kroger in the coming months, we will be preparing the business for a transformative relationship which will reshape the food retailing industry in the US in the years to come.”

Rodney McMullen, chairman and chief executive, Kroger, comments: “We see Ocado as an innovative, exciting and transformative partnership in pursuit of our Restock Kroger vision. Our partnership will speed up our efforts to redefine the food and grocery customer experience, creating value for customers and shareholders alike.”

Ocado has this year announced similar partnerships with Canada's Sobeys and Sweden’s ICA, and in 2017 a tie up with France’s Groupe Casino. It has also inked a deal with a yet-to-be named European retailer.