Ocado plans cost-cutting drive with up to 1,000 jobs at risk, says report

Ocado is drawing up plans that could put up to 1,000 jobs at risk as the retail technology group renews its focus on cutting costs and scaling back its workforce, reports have said.

The business, which runs robotic warehouses for supermarket chains, is in the early stages of talks over redundancies that would amount to about 5% of its global workforce, the Sunday Times reported.

No final decisions have been made and Ocado would consult with its staff over any planned cuts, according to the report.

A spokesman for Ocado Group declined to comment on the reports, but said: “We regularly review our operations to ensure we’re set up for long-term success.

“If and when decisions are made that affect our people, we are committed to communicating with them directly and ensuring they are supported throughout.”

The business unveiled plans nearly a year ago to scale back its research and development workforce in the UK, having spent more than £800 million in this area over the previous four years.

It was also aiming to substantially reduce its technology costs from around £290 million in the 2024 financial year to £60 million by 2027.

This coincides with a shift in focus towards the deployment of new technologies.

Ocado’s share price has come under pressure in recent months after announcing the closure of warehouses run with its grocery partners in the US.

Canadian supermarket chain Sobeys said it was closing its fulfilment centre in the Canadian city of Calgary, two months after US grocery chain Kroger decided to shut three Ocado-run warehouses and scrapped plans for new sites.

Ocado continues to operate five sites for Kroger and supports its logistics operations, and Sobeys uses two warehouses to support its online business.

The Hertfordshire-based group sells automation technology allowing retailers to pick and dispatch online food orders from giant robotic warehouses.

It also runs a UK online grocery firm as a joint venture with Marks & Spencer.