In a preview of what may be coming to Pleasant Prairie, Kroger Co. rolled out to the public Wednesday its first huge automated customer fulfillment center in partnership with British online retailer Ocado in Monroe, Ohio.
Cincinnati-based Kroger (NYSE: KR), the nation’s largest operator of traditional supermarkets including Pick ‘n Save and Metro Market stores in the Milwaukee area, opened the 375,000-square-foot facility early last month, when it delivered its first order. It will employ nearly 400 Kroger associates, CEO Rodney McMullen said.
The $55 million facility, Ocado’s first in the U.S., features 1,000 robots zipping around on grids to gather orders. Kroger touts it as combining vertical integration, machine learning and robotics to rapidly select and ship customer orders.
The Ocado “sheds,” as Kroger often refers to them, are vital to Kroger’s efforts to increase digital sales. It generated more than $10 billion in e-commerce revenue last year, increasing 116% from the prior year. Kroger expects to double those digital sales again by 2023.
“Our partnership with Ocado and the shed in Monroe further delivers on our ability to deliver things to our customers,” McMullen said.
The speed of selecting a customer order is almost mind-bending. The average customer order can be selected within two to three minutes, Ocado co-founder and CEO Tim Steiner said.
“It’s possible to be out the door in four, five, six minutes,” Steiner said.
On Wednesday, 275 robots whipped around the facility gathering 50 orders within three minutes, Kroger chief supply chain officer Gabriel Arreaga said. He called it “controlled chaos.” The facility serves customers within a radius of about 90 miles.
Read more at the Milwaukee Business Journal.