Ocado grows sales by 19.5%
Ocado increased its gross sales by 19.5% to £444.6 million in the 36 weeks to 7 August. In the 12 weeks to 7 August, gross sales grew by 16.9% to £147.9 million.
The online grocery retailer said it was targeting even higher growth rates for the remaining weeks of the year but warned that this was dependent on continued capacity expansion at its customer fulfilment centre as well as on levels of consumer confidence.
Ocado said it continued to experience capacity constraints at its Hatfield customer fulfilment centre but was aiming to increase capacity to 140,000 orders per week by the end of the fourth quarter. A second customer fulfilment centre in Warwickshire is progressing on-time and on-budget.
During the third quarter, Ocado invested in customer service and this led to improvements since the first half. Items delivered as ordered were at 99% and deliveries on time or early were at 95.5%. However, Ocado warned that this was likely to lead to a slightly lower than expected increase in full year margins.
The retailer said it was planning a number of new customer initiatives during the fourth quarter to differentiate Ocado from its competitors. The first of these initiatives will be the 'Ocado Saving Pass' which will offer customers who join the scheme discounts of at least 10% off standard Ocado retail prices across a range of over 500 products in return for a small subscription fee.
Tim Steiner, chief executive of Ocado, said: "In spite of the tough economic environment, our sales are growing substantially and we remain focused on improving range, value and service for our customers. We are continuing to expand the capacity of our first fulfilment centre in Hatfield, with significant progress made over the summer months. While conducting these works, we have invested additional resources in improving our key customer performance metrics and we are pleased that these efforts are paying off."
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