Market Leading Growth!

Hannah Gibson was in a good mood when talking about Ocado's performance.

In summary:

Ocado Retail’s FY24 Progress

Ocado Retail (ORL) achieved remarkable growth in FY24, with revenue rising by 13.9%, driven by a 12.5% increase in orders on Ocado.com, and reaching 500,000 weekly orders by the year end. The growth stems from ORL's commitment to delivering unbeatable choice, unrivalled service, and great value for families. The strategy resonated well, boosting ORL's online grocery market share to 1.8 percentage points and increasing its Net Promoter Score (NPS) by 4.9 points. Active customers grew by 12.1% to over 1.1 million, complemented by improved retention rates and enhanced targeted marketing efforts.

Network and Operational Advances  

FY24 marked substantial operational transformation for ORL, focusing on efficiency and network optimisation. Network utilisation rose to 89%, compared to 75% in FY23.

Key changes included closing the Hatfield Customer Fulfilment Centre (CFC) and opening the more efficient Luton CFC, driving productivity gains. Labour productivity at OSP CFCs increased by 9.1% to 227 UPH. Despite challenges from network reorganisation, ORL launched initiatives to optimise last-mile delivery efficiency. Profitability improved significantly, with adjusted EBITDA reaching £44.6m (£77.8m excluding Hatfield fees), representing margins of 1.7% (2.9% excluding fees), compared to FY23 0.4%.

Customer Proposition

• Unbeatable Choice: ORL offers 45,000 products, including M&S favourites, household brands, Ocado Own Range, and small suppliers’ offerings.

  Unrivalled Service: Leveraging Ocado’s technology, perfect orders increased by 6.3 percentage points, with 99% of items delivered on time and as promised. ORL enhanced product availability, delivery slots, and shelf life by half a day on average.

• Reassuringly Good Value: Through investments in pricing, including six “Big Price Drops” since mid-2023 and the Ocado Price Promise, ORL strengthened its value credentials.

Sustainability Commitment  

Under the “Planet Together” strategy, ORL made significant strides toward net-zero emissions. FY24 highlights include: validation of net-zero targets by the Science Based Targets initiative (SBTi), introducing innovative packaging for Ocado Own Range products, and collaborating with the Soil Association to advance sustainable farming practices.

Priorities for FY25 and Beyond   Looking ahead, ORL has evolved its strategy focusing on three key areas:

1. Leading Customer Proposition: Continuing to deliver unbeatable choice, unrivalled service, and great value to customers.

2. Smart Growth: Driving smart growth by enhancing customer lifetime value, reducing cost to serve, and maximising network capacity.

3. Platform for the Future: Building the foundations for future success through the adoption of new technology platforms, delivering a leading retail media offering, and nurturing high-performance teams.

"Laser-focused on customer service and delivering unbeatable choice"