Ocado to use Morrisons’ capacity at Erith after Andover fire

From Logistics Manager Magazine,
Published Friday 10 May 2019 12:11 pm

Ocado and Morrisons have agreed to temporarily suspend Morrisons.com’s capacity at Ocado’s Customer Fulfilment Centre in Erith in South-East London following the Andover fire in February as Ocado seeks additional capacity within its own network.

Morrisons will return to using its 30 per cent share of capacity in Erith in February 2021 and will not incur any of the costs associated with the use of CFC. It will also benefit from lower store pick fees.

Morrison.com will continue fulfilling orders from Morrisons stores using Ocado’s store pick solution.

Both parties have agreed to a mutual relaxation of certain exclusivity provisions bringing Morrisons more in line with the terms agreed with existing international Ocado Solutions clients.

In the meantime, Ocado will investigate longer term steps to replace the lost capacity from the Andover CFC.

“We are pleased to be helping our partner in times of need after the recent fire. We will keep growing Morrisons.com for our customers and save some cost, returning to the Erith CFC when it is more mature,” said Morrisons chief executive officer, David Potts.

“Our new agreement allows us to have more than one digital partner, and opens the way for significant potential opportunities and partnerships in this important growth area for Morrisons.”

Ocado chief executive Tim Steiner said: “Morrisons is a valued partner of Ocado and we are glad that we have been able to come to an equitable and pragmatic agreement that is in the interests of both parties. We look forward to welcoming Morrisons back to Erith in February 2021″.