The Kroger Co., in another expansion of its fulfillment network, is bringing its Ocado-enabled consumer delivery service to Indianapolis.
A new delivery hub in Indianapolis will coordinate with a sister facility in Monroe, Ohio, to bring Kroger Delivery to 30 central Indiana ZIP codes and east to Richmond, IN on the Ohio state border.
In the service area, customers can place an order on Kroger.com or the Kroger app. Then, a Kroger Delivery associate in a temperature-controlled van fulfills the order. The delivery network will leverage not only hubs but also stores and third-party partners to deliver certain orders. Kroger Delivery will offer variable delivery fees that do not require customers to provide a tip and are influenced by factors such as customer loyalty, delivery window popularity, route optimization and the lead time of an order.
The expansion in Indianapolis represents an extension of a partnership between Kroger and Ocado, a company based in the United Kingdom that has developed proprietary technology for grocery e-commerce. In 2018, the companies announced a partnership through which they would establish a delivery network in the United States that combines artificial intelligence, advanced robotics and automation as developed by Ocado. Kroger chairman and CEO Rodney McMullen noted that Kroger Delivery “underpins the permanent shift in grocery consumer behavior and elevates our position as one of America’s leading e-commerce companies.”
Although it serves regions where the company operates physical stores, the Kroger Delivery network has begun to serve customers in Florida, where the company lacks brick-and-mortar locations.
The Kroger Delivery network relies on highly automated fulfillment centers, or hub sites, where more than 1,000 bots travel 3D grids, orchestrated by proprietary control systems. The grid, known as The Hive, contains totes carrying products and ready-to-deliver customer orders. A temperature-controlled delivery van receives up to 20 orders at a time. With machine learning algorithms optimizing delivery routes, and considering factors such as road conditions and optimal fuel efficiency, vans may travel up to 90 miles with orders from hub and associated spoke sites to make deliveries. Workers at the spokes deliver orders within their service area, adding ZIP codes as demand grows.
Kroger unveiled the Monroe fulfillment center earlier this year in April, its first Ocado facility followed by its second in Groveland, FL. The fulfillment network plans additional sites including in California, Dallas, TX, Forest Park, GA, near Atlanta, Frederick, MD, Phoenix, AZ, Pleasant Prairie, WI, and Romulus, MI, in the Detroit metro area, as well as in South Florida and the Northeast.
