Kroger partners with e-commerce company to build new fulfillment centers

The Kroger Co. and Ocado have signed a service agreement to build automated warehouse facilities in the U.S.

The U.K.-based online grocer Ocado said Kroger plans to order three customer fulfillment centers by the end of 2018. Kroger plans to order 20 fulfillment centers in the first three years of the agreement.

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“This is a significant step toward both solidifying our partnership with Ocado and redefining the Kroger customer experience,” said Alex Tosolini, senior vice president of business development of Kroger, in a statement. “The alliance will bring to the U.S. Ocado’s unparalleled innovation and technologies. This is exciting news and will help accelerate our vision to serve America through food inspiration and uplift.”

The locations of the fulfillment centers have not been announced by Kroger yet.

The cost for the first three customer fulfillment centers is estimated to cost £90 million, according to Ocado. Ocado will help Kroger augment its digital and robotics capabilities, making the grocer’s omnichannel more sophisticated.

Kroger also raised its investment in Ocado by 5 percent through a subscription rights agreement. That brings its stake in the U.K. company to over 6 percent.


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