What is Ocado? Ocado Review, Features

Ocado is the largest B2C e-commerce platform in the UK. It was founded in 2000 by three bankers from Goldman Sachs. Ocado sells a variety of products including fresh food, snacks, alcoholic beverages, maternal and child products, kitchen products, and home products. It calls itself "the world's largest pure online grocery retailer."

About Ocado

Ocado was founded in 2000 and is headquartered in Hatfield, Hertfordshire, UK. In addition to selling fresh food, it also sells other foods, toys, medicines and household goods. Its brands include Ocado online mall, Ocado smart platform, Sizzle kitchen supplies website and Fetch pet supplies website. In January 2002, the company established its first logistics and warehousing center in Hatfield and began formal operations.

Category Introduction

Ocado is a unique, fully independent online grocery store focused on bringing high-end food, fresh produce, beverages and household items to consumers.

1. Fresh food and other private label foods;

2. Flowers, toys, groceries, magazines and other brands of products;

3. Products from third-party platforms, such as Carrefour, are also sold through the Ocado platform.

Currently, Ocado warehouses can support the storage of 21,500 items, of which more than 250 items are Ocado's own brands.

Operational Model

Relying on high-quality and efficient cold chain logistics technology, the company has formed a unique online retail operation model.

As a pure online retailer, Ocado has no offline physical supermarkets. The company's business currently consists of two parts: self-operated retail and platform operation (helping third parties operate e-commerce businesses). Its independently developed cold chain logistics technology and intelligent warehouse and distribution system constitute the core competitiveness of the company's business. Based on scale, automated operations and innovative application of patented technologies, the company has achieved a virtuous cycle of profit growth, technological innovation, efficiency improvement and capital expenditure.

Supply Chain Model

Flat supply chain, suppliers directly supply to the operation center CFC (Central Fulfilment Centre), accounting for 85%, and then directly deliver to the customer's home according to the order. In Hatfield, UK, there is a 295,000 square feet operation center (CFC), 85% of the incoming goods are directly delivered to the CFC by suppliers, and 15% of the incoming goods are delivered by the RDC of Waitrose supermarket.

Logistics services and technologies

1. Logistics center: In 2010, Ocado established a 295,000 square meter operation center in Hatfield, UK. The Ocado logistics center was built in a convenient transfer station on the highway and in the Prologis logistics park. All customer orders are processed in the CFC before being shipped out. In 2011, Ocado increased its warehouse capacity to meet the peak of 112,000 orders per week, and at the same time selected a site for CFC2.

2. Distribution: Through advanced logistics technology, Ocado's order accuracy rate reaches 99%. The delivery is carried out using its own customized refrigerated Mercedes-Benz trucks. 95% of the orders can be delivered to customers the next day, and 95% of the orders can be completed on time or even ahead of schedule. By 2011, Ocado's delivery service covered 70% of British households.

3. Logistics technology: Logistics centers use standardized containers and assembly line operations. Some logistics centers also use robots to handle non-food commodity operations.

About CFC

Of the three warehouses that Ocado has built, the Andover warehouse built in 2016 has deployed the latest smart warehouse technology, which is the robot automation technology that has recently received widespread media attention. By the way, Ocado calls these warehouses CFCs, which stands for Customer Fulfilment Centres. The biggest selling point of this smart warehouse is its huge three-dimensional warehouse design and the small robots that keep working back and forth on the top of the warehouse area.

Development History

-In 2000, the company was established and signed a brand cooperation and purchasing agreement with Waitrose supermarket.

-In 2002, the first operation center CFC1 was established in Hatfield, with a distribution range covering 220 American households.

-In 2003, more distribution stations were built.

-In 2008, Ocado adopted the same pricing strategy as Tesco and launched its own brand products.

-In 2009, Ocado on the Go, an iPhone shopping app, was launched.

-In 2010, CFC1 expanded its capacity by 30%, with average weekly orders exceeding 100,000, and the company was listed on the London Stock Exchange.

-In 2011, Ocado expanded its own-brand categories and launched the Ocado saving pass membership discount program.

-In 2012, we expanded CFC1 and introduced new sorting machines, bagging machines and other automated equipment; and established an overseas R&D office in Poland.

-In 2013, CFC2 was put into operation, the Fetch brand was launched, and a 25-year logistics technology service agreement was signed with Torsions.

-In 2014, Morrisons.com officially started operations; Ocado smart platform commercial logistics technology was launched; SLZZLE kitchen catering brand was launched; and the company achieved profitability in the first year.

-Since 2014, the company has opened its mature logistics technology services to other retailers in the form of Ocado Smart Platform and charged service fees. Morrisons became the first partner of the company's e-commerce operation platform.

-In 2015, the number of active users exceeded 500,000, with a peak weekly order volume of 2.25 million. Construction of CFC4 began, and a partnership with Marie Claire for beauty retail business was announced.

-As of the end of 2015, Ocado had 500,000 active users, more than 47,000 SKUs, an average weekly order volume of over 190,000, an order accuracy rate of 99.3%, and all customer orders could be delivered the next day.

-According to the 2017 financial report, Ocado has 645,000 active users, 49,000 SKUs, and a customer unit price of 107.2 pounds (about 954 RMB). Ocado's average weekly order volume is 273,000.

-From the end of 2017 to the beginning of 2018, Ocado announced long-term agreements with French retail giant Casino and Canadian retailer Sobey, providing its technical capabilities and open supply chain system to these companies, which were originally mainly offline retailers, to help them build online businesses.

News Events

In the early morning of February 5, 2019, a fire broke out in the state-of-the-art fully automated three-dimensional warehouse of Ocado, the largest fresh food e-commerce company in the UK, located in Hampshire. Nearly 200 firefighters and more than 20 fire trucks were involved in the firefighting.