Ocado boosts delivery performance

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Online grocer Ocado increased its delivery performance by six per cent in the first half to 150 deliveries per van per week, reaching a peak of 165.

Chief executive Tim Steiner said: “The last six months has been all about delivering our plans to increase capacity, efficiency and range and enhancing our offer to customers.”

On-time delivery performance and order accuracy also improved during the period to 93.2 per cent and 98.3 per cent respectively, the company said.

It also went live with enhancements to its Hatfield fulfilment centre at the end of 2011 which it said had reversed the negative trend in CFC efficiency. “Using the UPH efficiency measure, the average for the period was 114, while the average in the last four weeks of the period was 122.”

New picking capacity was added to at Hatfield (CFC1) during the period including a new large storage and picking machine which, once fully live, will have the capacity to both significantly extend the product range, as well as to remove the remaining ambient manual trolley picking operations over the next half year, improving efficiency and capacity.

The highest number of orders delivered in a week was more than 138,000. “As all the enhancements in CFC1 ramp up to maximum capacity, we shall progress towards taking capacity to 160,000 orders per week.”

Ocado is currently building a second fulfilment centre near Tamworth which is on target to open in the first quarter of 2013.

EBITDA rose 4.5 per cent to £14.9m on sales up 12 per cent to £332.3m. Steiner said: “We are pleased that sales growth was in line with market expectations. However, the grocery market and the general economic picture remain challenging and uncertain. The third quarter is particularly hard to forecast as we have already seen some disruption from the Jubilee events, and there is uncertainty as to the effect of the forthcoming Olympic Games, but we expect sales growth to increase in H2 2012 overall.”

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