Smart retailer Ocado signs eCommerce deal with Groupe Casino

Andrew Cummings
November 29, 2017

The British company today said it would provide its Ocado Smart Platform to French supermarket chain Groupe Casino.

An Ocado truck returns to the Ocado depot in Hatfield, southern England July 21, 2010.

"In FY19 and beyond, the profitability of Ocado Solutions is likely to grow as the fees from the transaction increase and as other deals are signed", the company said.

Casino, which competes with Carrefour, E.Leclerc and Auchan, has close to 13,000 stores in France, Latin America and the Indian Ocean region, although the Ocado tie-up only covers the French market.

"We continue to make investments to commercialize our proprietary platform and expect this deal to be one of many successful collaborations with leading retailers to use it the world over". If we're correct the shares could head back towards Monday's 264p high in the very near term.

Ocado launched its third party eCommerce platform for William Morrison supermarkets in the United Kingdom by providing warehouse operations for the single pick of products together with the entire end-to-end proprietary software required to operate an online grocery business - from user interfaces, through warehouse operating and control systems, to logistics, route planning and optimization.

It is also increasing the capacity at its new centre in Andover, while also working on its fourth and biggest centre in Erith, Dartford, which is set to open next year.

Analysts said Casino was betting on the online shopper in France adopting similar habits to Britain where online delivery vans are a common sight in towns and cities. "The deal makes a huge amount of sense given Monoprix's stature and premium offer in Paris, where there's a clear appetite for home delivery", suggested TCC Global analyst Bryan Roberts in an interview with Bloomberg.

Ocado has always been seeking to expand outside the United Kingdom, and reports earlier this year said the company may have been considering a deal with Lakeland, Fla. -based Publix Super Markets.

Ocado started out life delivering food from upmarket grocer Waitrose but has since struck a deal with Morrisons.

Ocado said it expected to incur additional capital expenditure of 15 million pounds next year, with further capex in future years.

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