Ocado is “confident” it will grow ahead of the online grocery market following a 15% increase in gross sales over the summer.
The retailer said the market was “tougher than it would like”, but stressed it was outperforming competitors with revenue growing to £314m in the 12 weeks to 7 August.
The average number of orders per week grew by 19% over the period, which Ocado hailed as evidence of its “leading customer proposition”.
“Shoppers are coming to us with increasing frequency, which is good news for the long term,” said chief financial officer Duncan Tatton-Brown. “They’re getting a greater proportion of their grocery needs from Ocado so it looks like we’re serving them how they want.”
Tatton-Brown dismissed concerns over the impact of food deflation on profit margins. He said Ocado was “best-placed” to absorb the effects, but expressed doubts that prices would continue to fall indefinitely.
“What I think I can say is it’s not sustainable in the long term for ongoing price deflation and cost inflation in a market that’s pretty flat. At some point the market will have to stop doing that,” he argued.
He was equally sceptical over the threat of express grocery delivery services such as Amazon Prime Now, which can deliver to customers’ doors within an hour of ordering. He questioned the amount of demand for speedy delivery.
“We have been offering same-day deliveries for six or seven years but it’s not particularly growing in a strong way. But we will keep our eye on the market and we have some ideas of our own,” he said. “I think to satisfy demand in that area you have to get quite a few things right and we can’t see anything that’s going to impact on our business.”
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