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Ocado warehouse closure puts 2,300 jobs under threat
Ocado Retail small restructure results in 40 head office job cuts
Online grocer Ocado has announced that it will cease operations at its Hatfield fulfilment centre later this year, putting 2,300 jobs at risk.
The company hopes to relocate as many employees as possible to other centres, including its new site in Luton.
The move comes as retailers are increasingly turning to robotic customer fulfilment centres, which are more efficient.
READ MORE: Ocado Retail ‘small restructure’ results in 40 head office job losses
Ocado expects the closure of the Hatfield site, its first fulfilment centre, to have no impact on the volume of orders it processes.
The site currently handles around one-fifth of the 400,000 weekly orders processed by Ocado.
After it closes, these orders will be redirected to other “high-productivity, next-generation facilities” across the UK, including the new Luton site set to open later this year.
Ocado’s latest automated fulfilment centres can pick over 200 units per labour hour, compared to around 150 units per labour hour for the Hatfield site.
The newer centres also have better capacity to handle same-day deliveries and are more energy-efficient.
Ocado CEO Tim Steiner said now is the right time to halt operations at Hatfield and consider “future options for the site”.
A consultation process has begun for affected staff, although the company expects to retain a large proportion of its colleagues.
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In February, Ocado reported a £500m annual loss and a decrease in the average number of items purchased per visit from 52 in 2021 to 46 in the previous year, though this was the same figure as before the pandemic.
The pandemic led to a surge in online grocery shopping as people avoided travelling to stores. Since March, Ocado has been price-matching Tesco on approximately 10,000 products as the battle between supermarkets intensifies.
Despite the competition, however, food prices have continued to rise at the fastest pace in 45 years, according to the latest official data.
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