Kroger reaches Pennsylvania with new Ocado e-commerce center

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The Kroger Co. plans to open another Ocado-automated customer fulfillment center (CFC) in Ohio, allowing the supermarket giant to serve consumers in Pennsylvania — where it has no physical stores — via an online grocery service.

Without specifying the location of the facility, Kroger said Thursday that the 270,000-square-foot “Cleveland area” CFC will serve areas of northeastern Ohio and Pennsylvania, the latter representing the 37th State of the retailer. The automated warehouse, which will create 400 jobs, should come into service 24 months after the first groundbreaking of the project.

Kroger’s first Cincinnati-based Ocado facility, a 375,000 square foot CFC in Monroe, Ohio, opened last April.

“Kroger is incredibly excited to expand our delivery business in our home state and provide Northeast Ohioans with access to thousands of fresh and popular products, including our Private Selection and Simple brands. Truth, industry leaders, through our fulfillment center,” Gabriel Arreaga, senior vice president and chief supply chain officer at Kroger, said in a statement. “The Cleveland-area facility is an accelerator in our strategy to double our digital sales and profitability by the end of 2023, and we look forward to providing a rewarding experience for our new customers in the northeast Ohio and Pennsylvania and create new jobs for people with a passion for technology, engineering, operations, logistics and transportation, inventory and quality management, service customer and engagement.

The Kroger Company.

Kroger’s partnership with Ocado enables the US supermarket giant to use online grocery delivery to enter new markets without having to open physical stores.

So far, Kroger has announced 17 CFCs, three of which – including the Monroe facility – are now fully operational. A 375,000 square foot CFC in Forest Park, Georgia opened in early February, following the launch of another 375,000 square foot CFC in Groveland, Florida, which went into service in June in a state where Kroger has no physical stores. In December, Kroger also announced plans to build a 200,000 square foot CFC in North Carolina.

Other Ocado CFCs reported by Kroger range from 135,000 to 375,000 square feet and include locations in Dallas; Frederick, Maryland; Phoenix; Pleasant Prairie, Wisconsin; and Romulus, Michigan, as well as unspecified locations in the Pacific Northwest, West, and Northeast, the latter representing another location where Kroger lacks stores. The retailer also announced plans for two CFCs in Southern California and two more in Florida.

“We are excited to bring Kroger and Ocado’s second automated warehouse to Ohio. As this site grows and goes live, it will help bring great grocery shopping experiences and exciting job opportunities to households in Cleveland, PA and beyond,” commented Luke Jensen. , CEO of Ocado Solutions, with US headquarters in Tyson, Virginia. “Today’s announcement marks another milestone in the development of Kroger’s seamless fulfillment ecosystem across the United States. Ocado’s proven technology will enable Kroger to achieve the lowest cost of service in the market, combined with the best freshness, accuracy and best grocery delivery service.

Additionally, Kroger has launched three “spoke” support facilities with Ocado technology — in Indianapolis and Tampa and Jacksonville, Fla. — and plans two more in Louisville, Ky., and Oklahoma City. This latest spoken site was announced last month and will bring Kroger to its 36th state, Oklahoma.

Kroger announced its partnership with UK-based Ocado Group in May 2018, when the companies said they were planning 20 CFCs in the US over the next three years. Ocado’s CFCs and supporting facilities use vertical integration, machine learning and robotics to serve online grocery orders and are expected to expand Kroger’s reach to a larger geographic footprint, including in areas where it does not operate physical stores.

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