Ocado has begun fulfilling orders from its crucial second warehouse in Dordon, Warwickshire.
Ocado’s second customer fulfilment centre (CFC), which has created 2,000 new jobs, aims to allow the etailer to serve large numbers of new shoppers efficiently after improving both its capacity and distribution methods.
The site, which dispatched its first orders to shoppers this week, is capable of delivering 180,000 to 200,000 orders per week and relieves pressure on the etailer’s first CFC in Hatfield.
The success of the Dordon distribution centre could prove key in winning over sceptical City analysts who question the pureplay’s business model in a market dominated by larger grocer’s with multichannel business models.
Shore Capital analyst Clive Black said: “That the centre opened on time is deemed by us to be good news although at £210m we would have been aghast if it had not opened on budget.
“We will now observe to see if commissioning goes smoothly, how the group’s sales momentum builds and what the doubling of its fulfilment infrastructure does to Ocado’s operating margins.”
Last month, the etailer opened its first dedicated non-food distribution centre in Welwyn Garden City, Hertfordshire as it makes a play for the non-food market.
Chief executive Tim Steiner’s strategy is to turn Ocado from “supermarket to hypermarket” by offering a vast array of non-food products.