Ocado says last quarter’s sales growth was restricted by driver shortage

UK-based online supermarket Ocado has reported an 11.6% increase in revenues, but says that a shortage of drivers restricted its sales growth.

In a statement issued today (14 December), Ocado said the revenue for its retail business for the 14 weeks up to 3 December was £378.8m, compared to £334.8m last year. The quarter was also notable for the new international partnership which Ocado signed with French retailer Groupe Casino.

Commented on the results, Tim Steiner, Ocado’s Chief Executive Officer, said: “We are delighted that Groupe Casino chose to partner with Ocado Solutions to develop its online food business and we remain confident in our ability to sign more deals such as this in the medium term.

“We are also encouraged by the progress we have made ramping up capacity at our revolutionary Customer Fulfilment Centre in Andover which has supported further growth in our retail business in the UK. Over the last few weeks, we have processed over 50% more orders per week through the Andover facility compared to the beginning of the period. We are making good progress with the resiliency issues we highlighted with the third quarter results and although there is still work to do we are on track with our plans.

“While we continue to report sector leading double digit sales growth in our retail business, a shortage of capacity, with the lack of drivers in certain locations being the largest factor, restricted our sales growth. While this driver shortage has now been largely resolved, there was some short term impact on average orders per week over the period.”

Steiner also said that Ocado was on schedule to open its fourth CFC, in Erith, South East London, in 2018.

“At scale, Erith will be able to process an additional 200,000 orders per week,” said Steiner. “Building scale and capacity in the UK will support the sustainable growth of our retail business, enabling us to take further market share in online grocery, and we look forward to the coming year with confidence.”