"Shares in Ocado dived almost 10% on Thursday after it announced that Sobeys would be shutting the Calgary facility, saying it was largely due to the Alberta grocery e-commerce market's size and the rate of expansion being slower than originally anticipated. The decision came less than three months after Ocado's US partner Kroger closed three warehouses, knocking almost a fifth off the UK company's value."
"Online grocery in North America has continued to develop, and Ocado's technology has evolved significantly since our first CFCs were launched in the region. The changes we have made in our relationships with both Sobeys and Kroger represent a reset of our North American business, placing those partnerships in the best position to secure long-term growth, while reopening a substantial market for Ocado's much evolved technology."
Sobeys will close a Calgary warehouse that used Ocado's robots and automation technology, citing the Alberta e-commerce market's size and slower-than-expected expansion. Ocado shares fell almost 10% on the news, following earlier closures by Kroger that had already hit the company's value. Ocado supplies its proprietary Ocado Smart Platform software and robotics to retailers worldwide, but faces competition and a trend of retailers fulfilling orders from stores. Sobeys will continue Voila online service through two fulfilment centres in Greater Toronto and Montreal, with Vancouver plans on hold. Ocado expected to receive 18m in compensation and described the changes as a reset of its North American operations aimed at long-term growth.
Read at www.theguardian.com
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