Kroger Co. continues to beef up its distribution network.
On Friday, the Cincinnati-based grocery giant, which runs Pick 'n Save and Metro Market stores in the Milwaukee area, announced plans to build new spoke distribution facilities in Austin and San Antonio, Texas, and in Birmingham, Alabama. All three represent new markets for Kroger, according to a news release. A total investment price was not disclosed.
The announcement comes as company executives continue to tout the early success of Kroger's 2021 expansion into Florida, where the company has just one store and a growing number of tech-centric facilities.
In recent months, Kroger has announced a string of new distribution facilities, including in Oklahoma City and just this week in Cleveland. Those facilities, like those in today's announcement, also are part of Kroger's ongoing partnership with British online grocery delivery company Ocado. Kroger plans to open 17 new Ocado-powered facilities over the next two years, the release states.
In 2018, the companies announced a collaboration to establish a delivery network that combines artificial intelligence, advanced robotics and automation.
The Ocado facilities, which Kroger calls “sheds,” are aimed at providing products for customers who order online, either to be delivered to their homes or to be made available for them to pick up at stores. The automated facilities are designed to make fulfilling those orders faster, more accurate and ultimately less expensive than if humans selected those orders at stores.
“Kroger’s growing seamless ecosystem continues to scale and allow us to reach customers who are not in the proximity of a store with delivery services, and we're committed to doubling both our digital sales and profitability passthrough rate by the end of 2023 and our continued network expansion will help us reach this target," Yael Cosset, Kroger’s chief information officer and chief digital officer, said in a statement.
Here's what Kroger had to say about its new facilities:
- Austin: The location is pending a lease agreement but is expected to be 70,000 square feet in the northeastern part of the city. Its hub will be in Dallas, and it's expected to employ 161 people.
- San Antonio: This location is also pending a lease agreement for a 67,000-square-foot space in the northeastern part of the city. It will also have 161 job opportunities and work with the Dallas hub.
- Birmingham: This 50,000-square-foot facility will be located at 30 W. Oxmoor Road, and work with Kroger's hub outside of Atlanta. It will have 161 job opportunities.
