Ocado’s chief financial officer has defended the retailer’s response to growing demand for its service, despite saying it was “barely scratching the surface” with regards to its backlog of new customers.

Duncan Tatton-Brown said he didn’t feel that Ocado needed to apologise for still being unable to bring on new customers, as this reflected “a societal desire” for more grocery home delivery generally and an increase specifically for M&S products since the switchover. 

In early April, as the UK settled into life in lockdown and demand for grocery home delivery soared, Ocado effectively closed its website to new customers in order to focus its limited capacity on existing customers and a portion of people shielding at home. 

As a result, by the summer, Ocado said it had built up a waiting list of around 1 million new customers trying to get access to its service. 

While Tatton-Brown said that Ocado had been able to add around 10% extra capacity since April, he admitted “we’ve got a long way to go to serve all the demand that’s there, and we’re barely scratching the surface on new customers”.

He said that the day of the M&S switchover was Ocado’s “biggest forward-order day in our history, even during the peak Covid-19 days” and reiterated the retailer was looking to add 40% new capacity by the end of 2021. 

“There’s a lot of demand for our service and can we satisfy all that demand? The answer is no,” he said.

“There will be a lot of people who’d like to order online and can’t. Unfortunately, that’s the case. But I don’t think we should apologise for that.”

While the M&S switchover was dogged by complaints of cancelled orders and high levels of substitutions on the day, Tatton-Brown insisted that, despite the “massive transition” for Ocado, “everything went very well”. 

“There was a late surge in demand, because there was even more demand than we expected, and we had some slight issues there,” he said. “But, overall, both we and our customers have been very pleased by the transition.” 

Tatton-Brown said that, because of the transition and an increase in sales during the normally quieter summer months with less customers travelling, Ocado was expecting full-year EBITDA profits to exceed £40m, above the £26m originally forecast.

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