Ocado third-quarter sales up 10%

Sales slowed down from a 12% growth rate in the first half.

Ocado chief executive Tim Steiner said he was “pleased” that customers’ ordering patterns had returned to normal after disruption from the Diamond Jubilee and Olympics in its crucial London market.

The etailer said that average order size in the 12 weeks to August 5, which encompassed the first week of the Games, grew from £111.08 last year to £112.44.

It said gross sales in the year so far are up 11.3% and that it has maintained margins despite “significant competitive couponing activity” in the market.

Ocado expects the rate of sales to pick up in the fourth quarter, despite continued pressure on the consumer spending environment.

The etailer said that, despite the Games, “the forward planning and IT solutions we undertook to prepare for these events enabled us to maintain excellent customer service”.

Ocado’s second customer fulfilment centre in Warwickshire is on track to open in the first quarter of next year, while it has phased out manual picking of ambient and chilled goods at its existing Hatfield distribution centre.

Ocado has expanded its range of products by 30% since the start of the year to 26,500.

It also plans to expand its Low Price Promise offer, which it has trialled in Manchester, which matches Tesco on price on certain products including promotions and gives customers money off if an Ocado shop is not cheaper.

Steiner said: “We are pleased our customers’ ordering patterns have returned to normal after the one-off Jubilee and Olympic events and are excited by the prospects of the changes we are making to our proposition.

“In particular, the Low Price Promise should give more confidence to consumers that they can buy the products they want at competitive prices at Ocado.”

Steiner added: “The grocery market and the general economic picture remain challenging, with consumer confidence subdued and significant competitive couponing activity. Notwithstanding this environment, we have continued to build on the foundations we have put in place to deliver growth and operational improvement through the rest of this year and for the future, and we are targeting an increase in sales growth through the remainder of the period.”