Kroger Turns to UK Online Grocer to Lift Its Digital Business

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Over the first three years of the agreement they are to identify a further 20 sites.

The deal to become Kroger's exclusive partner in the U.S. secures Ocadao's entry into the world's biggest market. The technology automates online grocery orders.

Currently, the two companies are looking for suitable locations to establish three automated warehouse facilities. "But the multitude of things we think we can do was what really got us over the finish line". "We are actively creating a seamless digital experience for our customers".

Rodney McMullen, chairman and chief executive of Kroger, said the partnership would allow it to "speed up our efforts to redefine the food and grocery customer experience".

"Ocado's unique, proprietary and industry-leading technology is set to transform the shopping experience of consumers around the world".

The Ocado CEO said his firm will work with Kroger to roll out up to 20 robotic warehouses across the USA over the first three years of the agreement.

The heated grocery wars have pressured No. 2 player Kroger, which issued cautious full-year profit guidance back in March amid rising competition.

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Ocado has broken off talks with other U.S. supermarket chains following the deal with Kroger, which operates nearly 2,800 stores across the USA under various brands.

Ocado said its "transformative" entry into the United States market centred on sharing its technology with Kroger, which had annual sales of $122bn (£90.4bn) in 2017.

"This model - a pure-play retailer using its platform as service support - was very successful for Amazon a decade ago, and this could potentially be a similar game changer for Kroger", she explained.

Ocado has always been considered a weak link in the supermarket sector by some analysts who brand it grossly overvalued. The Kroger partnership represents the fourth agreement Ocado has made during the past six months, although this represents its first foray into the US market.

Ocado already has a presence in other countries, including partnerships with Sobeys in Canada, Groupe Casino in France and ICA Group in Sweden.

The world's largest retailer reported a 3.1 percent decline in first quarter U.S. EBIT.

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