Coles’ $150m deal with UK online supermarket Ocado to change home delivery
Coles will spend up to $150 million over the next four years to double its home delivery capacity as it continues to shake up the online grocery shopping market in Australia.
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Coles will spend up to $150 million over the next four years to double its home delivery capacity after signing a deal to use tech from UK online supermarket Ocado.
Coles will pay Ocado to install and maintain equipment within new automated customer fulfilment centres outside Sydney and Melbourne, and to use its software.
The centres will be built and Coles’ migration to Ocado’s online platform complete by the end of the 2023 financial year, which Coles said would improve product range, availability and freshness for online customers — and improve profit margin.
“The partnership provides a unique opportunity for Coles to deliver a best-in-class customer experience,” Coles said in a statement on Tuesday.
“Coles will be better able to meet the increasing demands of its customers as it increases network capacity at a lower cost to serve.”
Customers outside of metropolitan Melbourne and Sydney will use the Ocado site, but orders will still be fulfilled by the existing store-based network.
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The deal with Coles is similar to that Ocado has with Morrisons, the UK’s fourth largest supermarket.
London-listed Ocado does not own any stores but operates under its own brand and those of other retailers including Marks and Spencer in Britain and US supermarket giant Kroger.
“Ocado is singularly focused on online grocery shopping, and as a result, has become the leading solution provider in the world,” Coles chief executive Steven Cain said.
“Ocado’s ongoing investment and retail partnerships around the world will help us continue to improve our offer into the future.”
The move to a new home delivery platform comes as Coles has also recently expanded its partnership with UberEats to allow customers to order “ready-to-eat”, “ready-to-heat” and “grab and go” options across Sydney.
The Coles-UberEats trial first started at its Pagewood store in Sydney’s east in January, but it has now expanded to Bondi Junction, Leichhardt, North Sydney and World Square outlets.
The partnership saw customers buy meals from Coles stores online. It has now expanded to also include items like milk, bread, fruit and vegetables.
The move to change online grocery shopping also comes as Coles recently partnered with eBay, so shoppers can buy a range of Coles items off eBay.com.au
Items on the site include select pre-packed fresh food, pantry, personal care and household products.
Shoppers in metro Sydney, Melbourne and Brisbane can access Coles on eBay with products available at the same national in-store prices.
Shoppers who have subscribed to eBay’s membership program, eBay Plus, enjoy free delivery on orders that are $49 and over and double the number of flybuys points on all orders.
An eBay spokeswoman told News Corp Australia the most purchased items when it first launched in early March have been nappies, spring water, soft drinks, seasonal fruit and vegetable boxes and baby food.
Originally published as Coles’ $150m deal with UK online supermarket Ocado to change home delivery
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The convoluted mess of card surcharges boils down to consumers and small businesses having to pay more. Extra funding for the ACCC will hopefully address the problem.
New crackdown on card surcharges
The convoluted mess of card surcharges boils down to consumers and small businesses having to pay more. Extra funding for the ACCC will hopefully address the problem.