Tesco has introduced a new ecommerce initiative, Transcend Retail Solutions, to rival Ocado and assist global supermarket chains in growing their online operations.

Led by Tesco’s strategy director Oliver Vogt, Transcend offers a package of software and hardware designed to help international grocers handle online orders directly from their stores, The Sunday Times reported.

Beyond its technology offerings, Transcend also delivers consultancy services. The new venture has already established a partnership with Foodstuffs North Island, New Zealand’s largest grocery retailer, and is negotiating with others for similar agreements.

As a trailblazer in online grocery shopping in the UK, Tesco processes over one million online orders weekly, with 85% of these orders fulfilled directly from its supermarkets.

“Our solutions are tried and tested,” Vogt said. “We set up Transcend because we truly believe we have something to offer the market.

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New Zealand’s Foodstuffs is using Tesco’s cloud-based picking software, which receives online orders and maps the most efficient route for staff to pick the items from supermarket shelves.

Tesco’s technology is currently operational in two Foodstuffs stores, operating under the Pak’nSave and New World brands, with plans to extend it to 150 locations.

This move is likely to catch the attention of Ocado, which has shifted from an online grocery business to an international technology provider and has deals with a tranche of global supermarket chains to build large automated warehouses for them.

Recently, two of the firm’s major clients, Kroger and Sobeys, have slowed their warehouse expansion after online grocery demand did not meet expectations.