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Ocado to open fourth distribution centre

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Ocado is to open a fourth distribution centre, the retailer said this week.

The new customer fulfilment centre, in Erith, South West London, is expected to open in 2017 after fit-out starts in 2016, the company said in a brief statement. The project, which has yet to win planning permission, will be developed by Bericote Properties and funded by real estate investment trust Tritax Big Box REIT.

Ocado said more details of the deal would come when it reports full-year figures next week.

Ocado currently has distribution centres in Hatfield and Dordon, Warwickshire. Today’s announcement comes almost exactly a year after the online grocer said it was looking for a site for a third centre: that centre, in Andover, Hampshire, is expected to open at the end of this year. The expansion plans are also revealed just over a year after the Morrisons online grocery service started operating. Ocado’s technology and distribution centres underpin the Morrisons operation, which delivered its millionth item just after Christmas.

The online grocer said before Christmas that its sales in the year to November 30 had hit £1.02bn after a 20% rise in sales during the year. At the time, Stephen Mader, of Kantar Retail, said the company was on the edge of its first profitable year, as geographical expansion drove sales growth. But this latest distribution centre opening seems to reflect increased sales in London and the south east, where Ocado’s customer base is rooted.

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