Coles has announced its plan to open automated fulfilment centres in Melbourne and Sydney by 2023 to double its home delivery capacity.
Mere weeks after announcing its game-changing move of selling through eBay, Coles Online has entered into an agreement with Ocado, a British online supermarket that has the tech Coles needs to make its online delivery offering truly competitive in the Australian landscape.
As part of the agreement, Coles will reportedly gain access to Ocado’s online grocery platform, which the Aussie supermarket chain will use to open automated fulfilment centres in Australia’s two biggest cities, Sydney and Melbourne, by 2023.
“Ocado’s ongoing investment and retail partnerships around the world will help us continue to improve our offer into the future,” Coles’ CEO, Steven Cain said in the announcement.
Including fees paid to Ocado, it’s estimated that Coles will spend between $130 and $150 million over the next four years to set up its new automated warehouses. The warehouses are expected to operate in a similar manner to Ocado’s UK operations, where the facilities are operated by an army of robots that pick individual grocery items for delivery from a vertical stacking system. The system, which has proven popular in international markets can reportedly process both fresh and dry grocery products. The multi-temperature facilities are expected to be able to handle large volumes of stock valued at between $500 and $750 million per year.
Under the agreement, Coles will also gain access to Ocado’s home delivery solution, which Cain says will double Coles’ online delivery capacity.
Ocado already works with retailers like Marks and Spencer in the UK and Kroger in the US.
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