Retailers

Kroger Reveals Site of Smaller and Faster Ocado Facility in Michigan

Romulus site less than half the size of developing siblings
Photograph courtesy of Kroger Co.

The Kroger Co. said Sept. 28 it has selected Romulus, Mich., as the site a forthcoming robotic e-commerce fulfillment center to be built in partnership with U.K.-based technology company Ocado.

The Romulus facility known as a customer fulfillment center, or CFC, represents the seventh known location for such a facility underway between the partners, who forged an exclusive U.S. partnership to build 20 facilities in 2018. Romulus will be the smallest, most cost efficient and fastest to build of those underway.

Kroger said the facility would be 135,000 square feet, or less than half the size of five other centers currently under construction, the smallest of which are 350,000 square feet. Kroger anticipates completing the Romulus project 18 months following groundbreaking—that’s six months faster than the announced build-out schedules of its larger siblings. The project will support 250 jobs whereas other announced projects contemplated up to 400 jobs per site.

“Kroger is incredibly excited to develop one of our industry-leading customer fulfillment centers in Michigan in relationship with Ocado to bring fresh food to our customers faster than ever before,” said Robert Clark, Kroger’s SVP of supply chain, manufacturing and sourcing. “We continue to invest in and constantly improve our e-commerce capabilities, focusing on cost-effective solutions. Our partnership with Ocado is an essential part of our evolving seamless ecosystem. In Michigan, we are engineering a smaller model for the region, leveraging advanced robotics technology and creative solutions to redefine the customer experience and respond to the growing demand for grocery e-commerce services.”

Kroger previously announced it would build a CFC in the Great Lakes region but didn’t until this week reveal the site, which will be located just outside the Detroit Metropolitan Wayne County Airport near Interstate 275. It is intended to serve customers throughout Michigan, Northern Ohio and Indiana.

Kroger said the project presents a $95 million investment.

Kroger has CFCs under construction now in Frederick, Md., Groveland, Fla., Dallas, Pleasant Prairie, Wis., Monrow, Ohio, and Forest Park, Ga. The Ohio and Florida facilities are expected to be the first to open, early next year. Kroger is expected to announce additional locations in the West and Pacific Northwest shortly.

“Grocery e-commerce has reached an inflection point in 2020, and with Kroger, we are developing a game-changing ecosystem for serving online grocery across the United States. Powered by Ocado’s state-of-the-art technology, this site illustrates the unique flexibility of Ocado’s technology, as we are able to deploy sites of different sizes in different regions to maximize penetration across diverse markets,” said Luke Jensen, CEO of Ocado Solutions, the e-tailer’s corporate partnership arm. “Ocado’s proven technology will allow Kroger to achieve the lowest cost-to-serve in the market, combined with the best freshness, accuracy and service.”

“Kroger’s decision to invest $95 million and create 250 new jobs in Romulus further demonstrates that Wayne County is a global leader in logistics and fulfillment industries. Kroger’s continued commitment to our region with the innovative new grocery delivery service provided by this high-tech facility will help improve access to fresh foods in southeast Michigan at a time when this service is more important than ever to keep residents safe and healthy,” said Warren Evans, Wayne County chief executive.

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