Ocado strikes Polish factory deal as Russian conflict nears the border

Online grocer Ocado and major European retailer Auchan have struck a second partnership in nine months, with the duo planning a factory in Poland by 2024.

UK-listed Ocado said its customer fulfilment centre would serve the Warsaw area, but that additional sites in the country could be announced in the future.

Besides the new site, Auchan Poland will use Ocado’s software across its hypermarkets to help Auchan staff pick items for online food and non-food orders more efficiently.

The plans come as Russia’s war with Ukraine creeps ever closer to the Polish border after strikes on the Yavoriv military base in the far-west of Ukraine.

But Gérard Gallet, chief executive of Auchan Retail Poland, said it was important to look to the future.

“In the current very difficult context we are faced with, our teams are very committed to helping Ukrainian refugees with the support of NGOs like Caritas and Red Cross,” he said.

“We strongly call for peace in Ukraine. At the same time, we would like to prepare our company for the future.”

Ocado boss Tim Steiner acknowledged that the announcement “comes at a very difficult time for everyone in Poland”, including its own staff in technology development centres in Wroclaw, Krakow and elsewhere.

“The human tragedy unfolding in Ukraine, and the refugee crisis along its borders, has shocked the world,” he said.

Under the terms of the deal, Ocado will receive certain fees upfront from Auchan Poland and during the development phase of its Warsaw site. Ongoing fees after completion will be linked to criteria such as sales targets.

In the longer term, the agreement will also be based on Auchan Poland hitting market share targets or ordering an agreed amount of capacity per year from the new fulfilment centre.

The move comes just nine months after Ocado secured a deal with Auchan’s Alcampo brand in Spain.

Auchan is one of the world’s largest grocery chains with €32 billion revenue and operations in 13 countries.