Ocado cost-cutting drive risks 1,000 jobs

The supermarket technology group is reportedly planning a significant number of redundancies as part of a cost-cutting drive. 

According to The Times, the business is in early-stage talks and although no final decision has been made, its global headcount could be reduced by 5% as a result of cuts. The report said an announcement cold come as soon as this month and that the majority of cuts were expected across its UK head office, including technology roles, as well as back-office staff across legal, finance and human resources. 

An Ocado spokesperson said: “We regularly review our operations to ensure we’re set up for long-term success. If and when decisions are made that affect our people, we are committed to communicating with them directly and ensuring they are supported throughout.”

Ocado made 1,000 group-wide redundancies in 2023/24, and last year announced plans to cut 500 tech and finance roles as it reduced spending on research and development. 

Shares have plunged by nearly a third over the past year after two of the business’ key North American customers announced plans to close a number of Ocado’s automated facilities, known as customer fulfilment centres (CFCs), because of concerns over cost and efficiency.

The US supermarket group Kroger said in November it would shut down three of its CFCs, a decision that left Ocado shares briefly hovering around the 180p flotation price of its initial public offering in 2010. Canada’s Sobeys followed last month, unexpectedly announcing plans to close one CFC in Calgary, Alberta, citing slower-than-expected growth and the size of the region’s online grocery market.