UK: Ocado sales surge ahead of online market
Ocado rounds off year with strong Q4
UK online grocer Ocado has booked a market-beating increase in sales as investments in capacity allowed it to fill more orders in its fourth quarter.
The company said today (16 January) sales rose 20.1% in the 16 weeks to 1 December. Gains were primarily driven by an increase in order numbers, which rose 19.1%, while basket size added 0.8% to the top line.
Ocado CEO Tim Steiner suggested the group's growth reflected "improvements to our proposition" as well as a growing appetite among UK consumers to shop online.
Assessing the result, Conlumino MD Neil Saunders said "much" of the company's growth could be attributed to capacity expansion. "Increased capacity ... has allowed the average number of orders placed per week to rise by 19.1% across the 16 week period. This growth is obviously necessary if Ocadois to obtain the economies of scale required to move into profitability," he suggested.
Saunders added the group's tie-up with Morrisons, which has led the UK's fourth-largest food retailer to launch online this month, would add another growth avenue that cold "help ease it into profitability".
Ocado will deliver its preliminary results on 4 February.
Click here to view the full sales update from Ocado.
The UK online grocery sector is highly innovative and disruptive - and it provides a template to the rest of the world....
2013 was a highly significant year for Morrisons. The company finally decided to develop an online grocery retailing service in partnership with Ocado. In addition, the company has capitalised on the ...
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