Ocado Group PLC Hatfield CFC - Update to Operations (2935X)
April 25 2023 - 3:00AM
UK Regulatory
TIDMOCDO
RNS Number : 2935X
Ocado Group PLC
25 April 2023
Ocado Group plc
25 April 2023
Hatfield CFC - Update to Operations
Ocado Group plc ("Ocado") announces that Ocado Retail Ltd, the
JV with M&S, has proposed network changes that include ceasing
current operations at its Hatfield Customer Fulfilment Centre
("CFC"), the oldest site in the Ocado network.
Under these proposals, we do not expect any change to the volume
of orders fulfilled. Customer orders which are currently fulfilled
in Hatfield, c.20% of Ocado.com's 400k orders per week, would be
moved to the company's high-productivity, next-generation
facilities around the UK. This will include the nearby Luton CFC
which is scheduled to open later this year to take advantage of the
continued channel shift to online.
There are currently around 2,300 employees based in Hatfield,
and Ocado has now commenced a consultation process with colleagues
on these proposals. Ocado's priority and focus will be to redeploy
as many people as possible to other sites, primarily to the soon to
be opened Luton CFC. The consultation is expected to close in the
summer 2023, with Hatfield operations planned to halt in line with
the start of operations at the Luton site.
The Hatfield CFC remains a foundation stone in the Ocado story,
as the company's first fulfilment centre and a core test bed for
the Ocado operating model, now deployed worldwide with Ocado
Group's retail partners.
However, over the past decade, Ocado has unveiled a raft of new
innovations, enabling huge leaps forward in both CFC productivity
and customer experience. The most recent of these, unveiled at
Ocado Re:Imagined in 2022, will deliver a step-change in the
efficiency of Ocado's operations, as well as the quality of service
that UK shoppers can expect online.
The latest generation of robotic CFCs are consistently achieving
well over 200 units picked per labour hour within the facility
('UPH'), compared to UPH of around 150 for our first generation CFC
in Hatfield. The newest sites also have much lower energy usage.
With the benefit of Ocado Re:Imagined, Ocado expects further
improvements in UPH and customer experience, including increased
capacity for same day deliveries.
Ocado Group does not expect a material financial impact from the
closure of Hatfield to its FY23 financial guidance.
Tim Steiner, CEO of Ocado Group and Chairman of Ocado Retail
said
"As the online grocery channel grows, our new, enhanced
fulfilment centres and technologies will drive a step change in
customer experience and efficiency.
With this capacity coming online, now is the right time for us
to halt operations at our oldest facility at Hatfield and consider
our future options for the site. Ocado.com customers will continue
to enjoy the same outstanding standard of service throughout the
region, which will further improve as the benefits of our new
technologies are deployed across the network.
We have many brilliant Hatfield-based colleagues who have been
with us for a long time and are a big part of our journey. We want
to keep as much of this talent and experience within the business
as possible and expect to retain a large proportion of colleagues
impacted by these changes, either in our new Luton CFC or across
our wider UK network. We will be doing everything we can to support
those affected through the consultation."
Contacts
-- Tim Steiner, Chief Executive Officer, on 01707 228 000
-- Stephen Daintith, Chief Financial Officer, on 01707 228 000
-- David Shriver, Chief Reputation Officer, on 01707 228 000
-- Martin Robinson/Jessica Reid at Teneo, on 020 7353 4200
Notes to Editors
About Ocado Group
Ocado Group is a UK based technology company trading on the
London Stock Exchange (Ticker OCDO). It provides end-to-end online
grocery fulfilment solutions to twelve of the world's largest
grocery retailers and holds a 50% share of Ocado Retail Ltd in the
UK in a Joint Venture with Marks & Spencer. Ocado has spent two
decades innovating for grocery online, investing in a wide
technology estate that includes robotics, AI & machine
learning, simulation, forecasting, and edge intelligence.
The person responsible for arranging the release of this
announcement is:
Neill Abrams
Group General Counsel and Company Secretary
Ocado Group plc
Buildings One & Two Trident Place
Mosquito Way
Hatfield
Hertfordshire
AL10 9UL
Tel: +44 (0)1707 228 000
Email: company.secretary@ocado.com
Ocado Group plc LEI: 213800LO8F61YB8MBC74
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