British online retailer Ocado has signed an agreement with ICA Gruppen to develop the Swedish retailer’s online grocery business, and expects the platform to be completed by the end of 2020.
ICA will develop a customer fulfillment centre in the greater Stockholm area, and move its store-pick based operations to the Ocado Smart Platform. Ocado said ICA will pay it certain upfront fees upon signing and during the development phase, and then some continuing fees.
ICA has around 1,300 stores and a 36% share of the Swedish market.
Per Strömberg, chief executive of ICA Group, said: “We are now laying the foundation for the next generation ecommerce offering, and we are putting an important piece of the puzzle in place to realise our digital ambitions for all of ICA Group. Today we have the industry’s most efficient processes for physical shopping, and through this agreement we can create the most efficient solutions also for ecommerce.”
In an official statement regarding the tie-up with ICA, Ocado said: “Ocado will partner exclusively in Sweden with ICA to launch their end-to-end solution for online grocery services. This will include best-in-class front-end web site functionality, supported by Ocado’s proprietary ‘web shop’ and mobile grocery ordering applications; construction of Ocado’s latest generation, state-of-the-art automated warehouse designed specifically for grocery ecommerce (in which Ocado will invest to install internal infrastructure and robots); and last-mile routing management technology to optimize delivery efficiency, customer service excellence and punctuality.
This is Ocado’s third major deal in six months. It signed an agreement with Canada’s Sobeys in January and one with France’s Casino in November.