Profitero was lucky enough to be invited for a recent tour of Ocado’s Customer Fulfilment Centre (CFC) in Hatfield. This unique automated picking facility covers the equivalent space of eight football pitches and is operated using software and proprietary technology built entirely by Ocado.
Ocado is the only dedicated online supermarket in the UK and all orders are centrally picked from one of Ocado’s Customer Fufilment Centres in Hatfield and Dordon. Ocado delivers over 30,000 product lines, including big-name brands, Waitrose goods, a range of over 550 Ocado Own Label products and now a growing non-food selection.
As we stepped inside the 23 acre fulfilment centre in Hatfield, described by Ocado as the ‘world’s largest grocery store’, baskets carrying food whirled around our heads as machines compiled the customer’s order. It was incredible to witness Ocado’s automated picking system in action, which uses complex computer code to compile a customer’s grocery shop.
The CFC houses endless conveyors and hundreds of cranes and shuttles, all controlled by Ocado software. The software routes customer orders from one pick station to another, and then onto dispatch. At any one time, thousands of customer orders, split into numerous boxes (or ‘totes’) will be moving on the conveyor.
Technology is the key to the online grocer’s super-efficient operation, with the team at Ocado telling us that almost all of the software has been developed in-house. Ocado has invested millions in this state-of-the-art technology, developing software systems and algorithms to solve an array of complex problems.
One of the many complexities is the need to balance across multiple pick zones while keeping to tight ‘just in time’ dispatch schedules, ready to be loaded onto Ocado’s fleet of 75 LGVs and 900 delivery vans.
Ocado’s half year results, published last month, showed that sales have increased by 15.6%. From our visit, it is clear that Ocado’s 13 years of understanding and refining the complexities of online grocery retail means that it is now well placed to take advantage of the growth in online grocery, predicted to double in size over the next 5 years according to retail analyst IGD.
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