Coles Group has secured two sites in Sydney and Melbourne for high-tech customer fulfilment centres (CFCs). The long term leases were struck with Charter Hall Group and Ocado Solutions will install and maintain the automation technology.
In March 2019 the company announced an exclusive services agreement with UK-based Ocado Group to implement its end-to end online grocery platform, automated single-pick fulfilment technology and home delivery solution (Food & Drink Business, 28/03/2019).
Ocado will be responsible for the installation and ongoing maintenance of automation equipment in the CFCs.
Coles Group CEO Steven Cain said a key element of Ocado’s model was its highly automated CFCs, which would give customers greater range and improved product availability as well as significantly increasing the company’s capacity to service online customers.
Ocado’s online fulfilment solution will also include new website technology for Coles Online and Ocado’s delivery management technology to maximise transport efficiency. For Cain, it will transform the Coles Online experience for customers while also reducing waste and improving safety for team members.
Cain said the investment in Coles’ technology-led transformation would support much-needed employment opportunities at a time when COVID-19 had led many businesses to cut or delay their investment plans.
Development of the CFCs will support more than 600 jobs during construction and fit-out, while a total of 600 additional ongoing jobs, including skilled technology roles, will be created at the CFCs once they commence operation in FY23, Cain said.
Luke Jensen, CEO of Ocado Solutions, said securing the development sites was an extremely exciting moment for the Coles-Ocado partnership, following the recent opening of Ocado's first international CFCs for partners in France (Groupe Casino) and Canada (Sobeys).
“Ocado's technology has revolutionised the way in which grocery shopping is done online,” he said.
“When these two Coles CFCs go live and begin to ramp up, they will be instrumental in delivering unrivalled online grocery experiences to Coles customers in Victoria and New South Wales.
“They will also create exciting job opportunities for engineers looking to work with some of the most cutting-edge robotics and automation technology in the world,” Jensen said.
Coles signed agreements with Charter Hall Group for long-term leases on the two sites in Wetherill Park, New South Wales and Truganina, Victoria.
Charter Hall managing director & group CEO David Harrison said: “The on-going growth of e-commerce and the focus on supply-chain efficiencies continues to drive the demand for well located, high quality logistics facilities.
“Charter Hall has demonstrated, via expanding our relationship with Coles, that our industrial estates located near major transport infrastructure continue to be well sought after by our major retail and logistics customers.”
The Melbourne facility will be around 30,000 square metres at the Midwest Logistics Hub, where a 44,000 square metre facility has been pre-leased to Toll for its Mars Group contract, and a further 46,000 square metres pre-leased by Uniqlo.
The Sydney site is also 30,000 square metres and will anchor a 14-hectare estate being developed by Charter Hall.
Coles chief property officer Thinus Keeve said Coles had a longstanding relationship with Charter Hall. “We’re very pleased to partner with them on this project. These two customer fulfilment centres will enable Coles Online to offer greater range and availability, from locations that allow us to deliver to customers across metropolitan Sydney and Melbourne,” Keeve said.
