The Kroger Co., America’s largest grocery retailer, and U.K.-based Ocado, one of the world’s largest dedicated online grocery retailers, are launching America’s first state-of-the-art automated customer fulfillment center (CFC) in Monroe, Ohio.
The $55 million, 335,000-square-foot CFC is expected to generate more than 400 jobs. The partnership was announced in May of 2018, broke ground on June 12, 2019, and is expected to be operational in spring 2021.
Research by Nielsen and the Food Marketing Institute found online grocery spending could rise to $100 billion annually by 2020. Furthermore, as many as 70% of consumers could be shopping for products online. Kroger is proactively innovating to capitalize on this trend, and the company’s CFC model will be replicated, with plans to open 20 CFCs in order to create a seamless customer experience that serves shoppers across the U.S.
“Kroger is incredibly excited to reach this meaningful milestone in our Restock Kroger vision to serve America through food inspiration and uplift,” said Rodney McMullen, Kroger’s chairman and CEO. “Our partnership with Ocado will introduce transformative e-commerce, fulfillment and logistics technology in the U.S. and bring customers fresher food faster than ever before, accelerating our ability to provide anything, anytime, anywhere.”
Ocado is partnering exclusively with Kroger in the U.S., enhancing Kroger’s digital and robotics capabilities, and helping expand its seamless coverage area to provide for every family in the country. Ocado’s warehouse technology includes grocery-packing robots working on a grid that fully communicate with each other. At one of Ocado’s U.K. facilities, the robots can pack up to 65,000 grocery orders each week.
“With construction starting for Kroger’s first customer fulfillment center in the Cincinnati region, we are now well on the way to a nationwide revolution in how Kroger customers experience e-commerce,” said Luke Jensen, CEO of Ocado Solutions. “In a fast-developing landscape for grocery retail, Kroger’s determination to continue delivering the best experience for its customers, online as in stores, is unparalleled.”
Kroger’s new venture begins in its home region of Southwest Ohio, an area known for being the second largest food flavoring hub in the U.S. Ohio also has a growing, vibrant tech environment across the state and one of the nation’s top infrastructures. From Ohio, companies can reach 60 percent of the U.S. and Canadian populations within a one-day drive. This means Kroger can quickly deliver fresh foods to customers in a variety of locations.
“Kroger is proud to choose our home state of Ohio as the location for the first-of-its-kind customer fulfillment center in America,” said McMullen. “We thank Governor Mike DeWine, JobsOhio, REDI and the Monroe City Council for supporting this project. Kroger is committed to helping position Ohio, Cincinnati and our region as landmarks for innovation, further advancing the area’s digital and technology ecosystem.”