Amazon Fresh competitor Ocado delivers "robust" results

By Jo Gilbert

Published: 31 January, 2017

Ocado, the online grocer often seen squeezing down the back roads of middle class England has reported a rise in annual profits.

For the year to November 27, annual profits were up 21.8% to £14.5m and annual revenues rose 14.8% to £1.27bn, results which chief executive Tim Steiner said reflected "robust trading in our core business...in what has been a challenging retail environment".

During the period, the online only retailer, which has almost 700 wines available in its red selection alone, also saw its customer base grew by almost 14% over the year to 580,000.

But while order volumes grew by 17.9% to an average of over 230,000 orders per week, basket spend dipped 2.7% to £108.10 compared to the previous year.

The results come against a backdrop of continuing price wars between the discounters and the Big Four, pressure from Amazon Fresh, and drawn-out negotiations for a possible overseas deal.

"Ocado's positive results are a clear indication that the brand has become the busy shoppers best friend and the other supermarkets really need to sit up and take note," Martin Lane, managing editor of www.money.co.uk said.

"Ocado can't afford to rest easy though, the world of online groceries is fiercely competitive and it's still unclear if their biggest threat, Amazon is a friend or foe. Ocado are yet to announce an overseas deal which is a good thing for consumers. More competitors in this space mean longer drawn out price wars - meaning shoppers will continue to enjoy cheaper pricing."

In the last year, Ocado commenced operations at their new customer fulfillment centre in Andover which has help to increase its capacity to fulfill over 20,000 weekly orders.

In a statement released today, Steiner said that a focus on e-commerce and logistics will help the business to move forwards.

"In this ever evolving retail environment, we look forward to further developing our capabilities through innovation, creating the next generation e-commerce capabilities that will ensure our offer remains compelling for both retail and OSP customers alike," he said.

Printer friendly version