Ocado Retail is planning to shut its oldest distribution centre as it shifts towards robotic warehouses, in a move that will affect around 2,300 workers.
The online grocer said its site in Hatfield, Hertfordshire, was the oldest customer fulfilment centre (CFC) in its network and is responsible for handing around 20% of its weekly orders, with over 400,000 orders every week.
The orders will instead be shifted to a new next-generation automated warehouse facility in Luton, which is due to open later this year.
It comes as it reported a Q1 sales climb to £584 million last month, despite customers buying less.
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Ocado has now started consultation with the 2,300 workers based at the Hatfield CFC.
A source told GG that workers at the depot were notified over email within the last 24hrs, and the online grocery retailer is doing all it can to ensure that those affected are able to move to the new Luton depot.
However, if workers at the Hatfield depot don’t wish to move to nearby sites such as Luton, they will face redundancy.
The group said it did not expect any change to the volume of orders fulfilled by closing the Hatfield centre, adding that current customer orders fulfilled from the site would be moved to the company’s other facilities around the UK.
Ocado also said it expected improvement in productivity and increased capacity for same-day deliveries with the help of new technologies.
“As the online grocery channel grows, our new, enhanced fulfilment centres and technologies will drive a step change in customer experience and efficiency,” CEO of Ocado Group and chairman of Ocado Retail, Tim Steiner said.
“With this capacity coming online, now is the right time for us to halt operations at our oldest facility at Hatfield and consider our future options for the site.
“Ocado.com customers will continue to enjoy the same outstanding standard of service throughout the region, which will further improve as the benefits of our new technologies are deployed across the network.”
Steiner added that they have “many brilliant Hatfield-based colleagues who have been with us for a long time and are a big part of our journey.”
He added: “We want to keep as much of this talent and experience within the business as possible and expect to retain a large proportion of colleagues impacted by these changes, either in our new Luton CFC or across our wider UK network.
“We will be doing everything we can to support those affected through the consultation,” Steiner emphasised.
