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With an aim to re-energize its IT operations, Sweden’s leading retailer <keyword id="2722463" type="UNKNOWN" weightage="20" keywordseo="ICA-Gruppen">ICA Gruppen</keyword> has selected India’s IT consulting firm <keyword id="6354512" type="CITY" weightage="20" keywordseo="Infosys">Infosys</keyword> as its partner. 
 According to this agreement, the <keyword id="2722483" type="UNKNOWN" weightage="20" keywordseo="global-IT-leader">global IT leader</keyword> will provide IT services across application and infrastructure maintenance to drive operational efficiency. Infosys would also ensure that IT projects add value to the growing business of ICA Gruppen. 
 “With a strong and skilled IT partner, which knows our environment, we will create greater flexibility for new business requirements, be able to cope with rapid and major changes more easily and quickly, and be better able to support our businesses in their operational development,” said <keyword id="2722484" type="UNKNOWN" weightage="20" keywordseo="Sven-Lindskog">Sven Lindskog</keyword>, <keyword id="74620" type="POSITION" weightage="20" keywordseo="Chief-Finance-Officer">chief finance officer</keyword>, ICA Gruppen. 
 The agreement expands on the existing partnership between Infosys and ICA Gruppen, with the retailer doubling the percentage of its IT operation provided by Infosys. It also covers full scope of IT services within the Sweden-based e-tailer, which includes IT infrastructure and group-wide IT services along with IT support for <keyword id="2722482" type="UNKNOWN" weightage="20" keywordseo="ICA-Sweden">ICA Sweden</keyword>. 
 Karmesh Vaswani, <keyword id="197605" type="POSITION" weightage="20" keywordseo="Vice-President-and-Head">vice-president and head</keyword> – Europe, Retail, CPG &amp; Logistics at Infosys, “Our role as a services and transformation partner will see us revitalize the IT operations at ICA Gruppen as well as bring new ideas to help them innovate.” 
 
“Our focus will be to help them renew their core operations as well as implement new capabilities in the most cost efficient manner,” added Vaswani. 
 
ICA Gruppen asserted that this partnership will reduce costs in stages by approximately Rs 500 million, starting from 2016. 
(Image: Wikimedia)

ICA Gruppen seeks Infosys help to revitalize its IT operations

<ul class="summary-list"><li>Online grocer <keyword id="2512298" type="COMPANY" weightage="60" keywordseo="Ocado">Ocado</keyword>'s stock market value has risen to £21.66 billion ($27.8 billion) – briefly making it the UK's most valuable retailer, ahead of Britain's biggest grocery chain, <keyword id="6398216" type="ORGANIZATION" weightage="60" keywordseo="tesco">Tesco</keyword>.</li><li>Ocado only has a 1.7% share of the grocery market, according to Kantar, but saw sales jump 52% in the quarter to August.</li><li>But it is uncertain how long this boom in grocery delivery will last after overall UK online food sales fell nearly 5% between July and August.</li></ul>Grocery <keyword id="35621" type="PERSON" weightage="60" keywordseo="e-commerce">e-commerce</keyword> service Ocado accounts for just a fraction of every pound spent on <keyword id="6368952" type="UNKNOWN" weightage="60" keywordseo="Shopping">shopping</keyword> in Britain, but is vying with supermarket group Tesco for the position of the country's most valuable retailer, having briefly overtaken its larger rival on Thursday. Tesco has nearly 4,000 stores in the UK alone and accounts for nearly a third of all spending in the domestic grocery market, making it Britain's biggest retailer, according to <a href="https://www.kantarworldpanel.com/grocery-market-share/great-britain">analyst firm Kantar</a>.Tesco is worth £21.06 billion ($27 billion), while Ocado, which has no physical stores and just 1.7% in market share, briefly reached as much as £21.80 billion ($28 billion) on Thursday. Ocado is now worth twice the combined value of Sainbury's and Morrisons – Britain's second and fourth biggest supermarket chains - and has seen its share price double over the course of this year, thanks in large part to a surge in the number of people opting for online grocery deliveries since the outbreak of the coronavirus pandemic earlier this year. The company is the top performer in London's FTSE 100, with a 108% gain in the year to date, compared with a 23% loss in the broader index and an 11% decline in shares of Tesco itself.Tesco is in the middle of a change in management this week. CEO Dave Lewis stepped down after six years and, from Thursday, will be replaced by Ken Murphy.<h2>Ocado's boom during the pandemic</h2>Ocado reported a <a href="https://www.ocadogroup.com/sites/ocado-corp-v2/files/investors/reports-and-presentation/3Q%202020%20Trading%20Statement%20-%20Ocado%20Retail%20JV.pdf">52% sales jump</a> in the quarter to August, with an average of 345,000 weekly sales.But Tesco is hot on Ocado's heels. The group said in August it is hiring for <a href="https://www.businessinsider.com/uk-tesco-adds-16000-jobs-hiring-spree-deal-online-surge-2020-8">16,000 new jobs</a> to facilitate online orders because of "exceptional growth" in sales.On September 1, Ocado switched the range of products it offers to M&amp;S, from Waitrose, both upmarket grocery chains. It reported that customers had responded "positively" to the change, and said shoppers were adding more items to their orders.But the partnership didn't have the smoothest start, after customers complained about order cancellations. But the launch day was biggest ever for forward deliveries, Ocado said. Under the agreement, Ocado can also sell around 700 product lines from M&amp;S's home and lifestyle ranges.Ocado also sells technical solutions to other grocers through its Ocado Solutions arm. The service gives retailers access to the company's warehouse operation solutions and software. The first distribution center through the partnership opened in March in France, despite COVID-19-related disruption. Ocado Solutions now has partnerships with Kroger in the US, Sobeys in Canada, Morrisons in the UK, ICA in Sweden, Group Casino in France, and Bon Preu in Spain.<h2>Falling online grocery orders</h2>But it is uncertain how long this boom in online deliveries will last. UK online food sales were nearly 5% down in August compared to July as customers returned to supermarkets — but British shoppers are still spending nearly twice as much on grocery deliveries than last year, according to recent data from the <a href="https://www.ons.gov.uk/peoplepopulationandcommunity/healthandsocialcare/conditionsanddiseases/bulletins/coronavirustheukeconomyandsocietyfasterindicators/17september2020#business-impact-of-the-coronavirus">Office for National Statistics</a>.Total food sales across both online and physical stores fell by around 2% from July to August. Britain's <a href="https://www.businessinsider.com/eat-out-to-help-out-costs-uk-567-million-2020-9">"Eat Out to Help Out"</a> scheme – which saw diners eat more than <a href="https://www.gov.uk/government/news/uk-diners-eat-100-million-meals-to-protect-2-million-jobs">100 million meals out</a> in August as part of a government-subsidized scheme to boost the hospitality industry – caused supermarket sales to plummet by £155 million ($201 million) in August, research by <a href="https://www.kantar.com/">Kantar</a> shows.Not only are <keyword id="836280" type="PERSON" weightage="60" keywordseo="online-sales">online sales</keyword> falling – British supermarkets are also under strain as <a href="https://www.businessinsider.com/tesco-morrisons-ration-toilet-paper-pasta-covid-19-panic-buying-2020-9">some shoppers have started panic buying</a> after Boris Johnson announced new lockdown measures. Last week, supermarkets including Tesco, Sainbury's, and Morrisons reintroduced product limits on items like tinned food, toilet paper and hand sanitizer. One Morrisons employee told Business Insider their store was "worse than a bad Christmas."But for now, Ocado doesn't expect a slowdown in online orders to significantly affect its bottom line. Earnings before interest, taxes, depreciation, and amortization (EBITDA) for 2020 should reach "at least" £40 million, Ocado said. Last year it recorded EBITDA of £43.3 million – a 27% fall from 2018.

Online grocer Ocado is vying with supermarket giant Tesco to be the UK's most valuable retailer

<ul class="summary-list"><li>As grocery stores worldwide experienced stockpiling, long lines, and health worries amid the coronavirus pandemic, millions of people turned to shopping online.</li><li>It has been a goldrush for the British company <keyword id="2512298" type="COMPANY" weightage="60" keywordseo="Ocado">Ocado</keyword>, an online-only grocery marketplace that also operates technology for supermarket giants worldwide.</li><li>Ocado was the best performing stock on the FTSE 100 in the second quarter of 2020, and, in May, Ocado raised over $1 billion to grow its services.</li><li>It is now betting big on its US expansion, hoping to convert Americans to <keyword id="62452" type="PERSON" weightage="60" keywordseo="grocery-shopping">grocery shopping</keyword> online.</li><li>Huge challenges remain, though. Many Americans are still reluctant to buy food they can't see in person, and some fear the current online pandemic-driven boom could prove a one-off.</li></ul>The coronavirus pandemic has forced even those most resistant to digital change to give ground, and e-commerce is burgeoning like never before.Trapped at home, or faced with hours waiting only to find empty shelves, more people than ever are turning to online grocery shopping."There is pretty strong evidence that that is here to stay," Luke Jensen, executive director of the Ocado Group and CEO of Ocado Solutions, told Business Insider.Ocado is a household name in British cities, but its business is largely unknown elsewhere.<h2>A British success story</h2>The company's work is twofold. There is Ocado <keyword id="6354851" type="UNKNOWN" weightage="60" keywordseo="retail">Retail</keyword>, which sells groceries and other supermarket products to consumers online. The second aspect is Ocado Solutions, which provides technology to the online operations of major global supermarkets like Kroger in the US, Sobeys in Canada, and Waitrose in the UK.The company, which was founded in 2002, does not expect to turn a profit until 2024. It has high running costs, a sky-high share price, and a price-to-earnings ratio to match. In short, it's now acting like less an online retailer and more like a tech giant.Its <a href="https://markets.businessinsider.com/stocks/ocado_group-stock">share price</a> hit a record £22.36 ($28) on June 1, and the company has turned out to be the best performing stock on the FTSE 100 in the second quarter of 2020, boasting a 66% rise.<div type="image" title="ocado luke jensen" height="719" width="1438" msid="76920486" hostid="261"></div>Ocado first set out as an online grocer, boxing and delivering orders for Waitrose, the UK's deluxe supermarket. But it has now established itself as the guardian of online grocery delivery in its own right.It now has operations in the US, Canada, Britain, Sweden, France, and Japan.The pandemic has wreaked havoc on many industries, and businesses around the world are struggling to stay afloat. National economies are sliding into recession, as global unemployment rates are inching upward.But Ocado, and the grocery sector at large, have found themselves booming in light of astronomical demand. <h2>The future of food is online</h2>The pandemic has left companies around the world reassessing how the habits of their customers will change. Nowhere has this been more apparent than in grocery shopping."When you see people try grocery online for the first time, there's a high proportion of people who stick with it and make it part of their repertoire," Jensen said.There are many signs that online grocery shopping is growing.Online grocery sales in the US boomed to $7 billion in May 2020, up from $5.3 billion in April, according to a <a href="https://www.brickmeetsclick.com/stuff/contentmgr/files/0/b33b7d7f9604fb8a97b9678ec53165a0/files/bmc_mercatus_may_2020_scorecard_press_release_with_graphic.pdf">Brick Meets Click/Mercatus Grocery Shopping survey</a>. For reference, this number was $1.2 billion in August 2019.A <a href="https://www.nielsen.com/us/en/press-releases/2018/fmi-and-nielsen-online-grocery-shopping-is-quickly-approaching-saturation/">2018 Nielsen study</a> also predicted that 70% of US consumers would be grocery shopping online by 2024.Before the pandemic, online grocery shopping made up only 4% of the US market, but that is set to change."The US has seen an enormous boom," Jensen told Business Insider. "We expect a lot of that to stick."<div type="image" title="NEW YORK, NEW YORK - MAY 25: A man wearing a protective mask while pushing a stroller looks at a sign in a store window which reads 'WE ARE CLOSED' in Sunnyside during the coronavirus pandemic on May 25, 2020 in the Queens Borough of New York City. Government guidelines encourage wearing a mask in public with strong social distancing in effect as all 50 states in the USA have begun a gradual process to slowly reopen after weeks of stay-at-home measures to slow the spread of COVID-19. (Photo by Cindy Ord/Getty Images)" height="3010" width="6021" msid="76920487" hostid="261"></div>Back in the UK — where, pre-pandemic, 7% of grocery shopping was online — Ocado said in May that "a simply staggering amount of traffic" meant they had to turn away new customers. "They could be doing even better than they are because they deliberately limited their growth," Matt Botham, a strategic insight director at the Kantar data consultancy, told Business Insider.The elevated demand for online grocery shopping won't last forever. Shops will reopen, and constraints on freedom of movement will end.But what is expected to remain — and what Ocado is betting its bottom dollar on — is the knowledge that online grocery shopping is possible, and may even be preferable.<div type="image" title="LONDON, UNITED KINGDOM - 2020/03/18: In this photo illustration, a screenshot of Ocado's website, showing over 7100 people waiting for online shopping with wait time of about two hours. (Photo Illustration by Dinendra Haria/SOPA Images/LightRocket via Getty Images)" height="2000" width="4000" msid="76920489" hostid="261"></div><h2>'The share price is what it is, but we're not going to ... go all Elon Musk'</h2>"Ocado has been absolutely smashing it during lockdown," Fawad Razaqzada, a financial market analyst, told Business Insider. Daniel Coatsworth, the editor of the Shares financial-news magazine, also told Business Insider: "Any grocery company with either an inferior service, or without one at all, will be seriously looking at how they can up their game. And that's where Ocado's strengths lie.""It's easy to see why Ocado has done so well on the stock market this year."But as a result of Ocado's extraordinary rise, some wonder whether the company is overvalued.<div type="image" title="Ocado share prince" height="455" width="1163" msid="76920492" hostid="261"></div>Ocado's price-to-earnings ratio — how many years of annual earnings it would take to make up its valuation — is way higher than its competitors, a common trait of tech stocks. "The share price is what it is, but we're not going to worry about it and go all Elon Musk," Jensen said, referring <a href="https://www.businessinsider.com/elon-musk-selling-belongings-house-tesla-stock-2020-5">to the view taken by the Tesla CEO</a> that investors are overvaluing his company. "We're delighted the world is seeing that opportunity, and we're embracing it vigorously and going after it.On June 11, Ocado announced <a href="https://www.businessinsider.com/ocado-raises-1-billion-online-interest-surges-2020-6">it was raising £1 billion ($1.24 billion) from investors</a> to expand its services."The opportunity for Ocado is massive in what we do," Jensen said. "There will then will be opportunities beyond what we do."<div type="image" title="NEW YORK, NY - APRIL 15: A view outside GUESS store in Broadway during the coronavirus pandemic on April 15, 2020 in New York City. COVID-19 has spread to most countries around the world, claiming over 134,000 lives lost with over 2 million infections reported. (Photo by Noam Galai/Getty Images)" height="1579" width="3159" msid="76920496" hostid="261"></div><h2>Grocer or tech firm?</h2>Ocado's cash cow is not its grocery business, but in its technology.The company owns hundreds of patents for the machinery and software that power its warehouses, from product-picking robots to item scanners that members of staff can wear on their heads.This software, and future products, can be leased to supermarkets across the world. That's where Ocado's value lies."Investors bidding up Ocado's shares are effectively saying that its services as a provider of solutions to automate online grocery orders will be in greater demand," Coatsworth said."There is merit in the market valuing it as a technology stock rather than as simply a grocer or delivery business."<div type="image" title="FILE PHOTO: A general view shows conveyer belts transporting crates filled with packed bags inside the Ocado Customer Fulfilment Centre in Hatfield on the outskirts of London, Britain, April 6, 2016 . REUTERS/Dylan Martinez/File Photo" height="2062" width="4123" msid="76920498" hostid="261"></div><h2>The future of online grocery shopping</h2>"At the heart of it all," Ocado says on its website, "lies our technological know-how and unparalleled IP."This stands for intellectual property — one of the most lucrative assets a tech company can own.Ocado has registered at least 350 patent applications in Europe alone, according to <a href="https://www.reddie.co.uk/2020/04/09/the-rise-of-ocado-an-intellectual-property-success-story/#:~:text=Ocado's%20grocery%20picking%20technology%20is,rights%20to%20protect%20their%20investment.">IP law firm Reddie and Grosse</a>.Half concern "storing articles, individually or in orderly arrangement, in warehouses," the firm said. Dozens entail "systems and methods ... relating to logistics."<h2>Coming to America</h2>Nowhere has online grocery shopping boom been more apparent than in the US.Americans weren't big on online grocery shopping before the pandemic, with it making up just 4% of the total market.<div type="image" title="A worker delivers grocery bags to households in Stockholm, Sweden, on March 21, 2020 as internet shopping of food stuffs have skyrocketed in Sweden since the start of the Coronavirus Covid-19 outbreak. (Photo by Anders WIKLUND / various sources / AFP) / Sweden OUT (Photo by ANDERS WIKLUND/TT News Agency/AFP via Getty Images)" height="1744" width="3487" msid="76920503" hostid="261"></div>Kroger, the largest US grocer, appears keen to get a head start.It struck an exclusive partnership with Ocado 2018, and the companies already have plans to develop 20 distribution centers across the country.They have broken ground on three so far, with the locations of six more confirmed. Smart warehouses are underway in Monroe, Ohio, where Kroger is a mainstay, and Groveland, Florida, where rivals — Publix and Target — rule the roost."We see plenty of evidence that what we will be able to develop with Kroger will be able to push on quite an open door in terms of consumer demand," Jensen told Business Insider.<h2>No mean feat</h2>But getting Americans to shop for groceries online isn't as simple as it sounds. There has been a traditional reluctance to purchase fresh food online because <a href="https://qz.com/1077743/people-dont-buy-groceries-online-because-they-prefer-to-pick-things-out-in-stores/">people want to see what they are going to put in their mouths</a> before they buy it.At an Amazon Fresh distribution warehouse in Washington state, <a href="https://dspace.mit.edu/bitstream/handle/1721.1/99025/921306927-MIT.pdf;sequence=1">a third of bananas were thrown out</a> because each banana had to be perfect to the naked eye, <a href="https://dspace.mit.edu/bitstream/handle/1721.1/99025/921306927-MIT.pdf;sequence=1">an MIT study found in 2015</a>.A 2014 Instacart training video <a href="https://qz.com/1077743/people-dont-buy-groceries-online-because-they-prefer-to-pick-things-out-in-stores/">seen by Quartz</a> told its fruit pickers to "make sure there are no bruises, no cuts, no mold, it's not too soft, not too hard, just perfectly ripe."And as consulting firm Oliver Wyman wrote <a href="https://www.oliverwyman.com/content/dam/oliver-wyman/global/en/2014/oct/OW_Future%20of%20Online%20Grocery_Final_ENG.pdf">in 2019</a>: "Customers resist the idea of having someone else pick fresh food for their family."The boom in <keyword id="6357762" type="UNKNOWN" weightage="60" keywordseo="online-shopping">online shopping</keyword> during the pandemic could be a flash in the pan, rather than an inflection point for the industry. <div type="image" title="FILE PHOTO: The Kroger supermarket chain's headquarters is shown in Cincinnati, Ohio, U.S., June 28, 2018. REUTERS/Lisa Baertlein" height="2016" width="4032" msid="76920504" hostid="261"></div>Another orthodoxy about online grocery shopping is that the US is just too big to cover with online delivery.Ocado is less concerned about the challenge, however. Jensen concedes that the US is huge, but said "if you look at the distribution of the population in the US, you have about 75% of the population who live in urban or related-to-urban markets.""In that respect the US is not terribly dissimilar from any other geography around the world."Worldwide, Ocado has partnered with Kroger in the US, Sobeys in Canada, Aeon in Japan, Waitrose and Marks &amp; Spencer in the UK, Groupe Casino in France, and ICA in Sweden.In Japan, online grocery sales doubled during its coronavirus lockdown, which is remarkable for a country that obsesses over fresh produce and food presentation.As Ocado proclaimed in its 2019 report: "We can change the way the world shops."<div type="image" title="An Ocado lorry is seen on the M25 motorway, as the spread of the coronavirus disease (COVID-19) continues, London Colney, Britain, April 17, 2020. REUTERS/Matthew Childs" height="1101" width="2202" msid="76920505" hostid="261"></div><h2>Leading the field at the right time</h2>Coatsworth, the editor of Shares magazine, said: "What the market hasn't priced in is the likelihood of increased competition. If the opportunity is so clear for everyone to see, there will inevitably be other players entering the scene."Several competitors already exist, especially in the US.The main ones are <a href="https://www.businessinsider.com/amazon-fresh-vs-prime-pantry?r=US&amp;IR=T#your-amazon-pantry-cheat-sheetheet">Amazon Fresh</a> and Instacart. Fresh Direct and Shipt, which is owned by Target, are also in the game.<div type="image" title="Delivery vans are lined up prior to dispatch at the Ocado CFC (Customer Fulfilment Centre) in Andover, Britain May 1, 2018. Picture taken May 1, 2018. REUTERS/Peter Nicholls" height="2677" width="5354" msid="76920508" hostid="261"></div>Amazon has tried to get online vegetable and fruit delivery to stick for some years, but with little to no success.When asked about the company, Jensen said it has been fascinating to watch."What's interesting with Amazon is they've been in grocery for over 10 years now and they've made multiple attempts at particularly getting into the fresh grocery market, and today their market share remains very, very small," he said."I think what that indicates is not that Amazon is not good at doing stuff, it indicates just how difficult and different grocery is."<h2>'We don't do vanity tech projects'</h2>The Ocado vans that ferry food from warehouses to homes still bear the slogan "the online supermarket," but the company is essentially a tech company. (It successfully <a href="https://markets.businessinsider.com/news/stocks/ocado-no-longer-a-grocer--cma-rules-8249813">applied to be un-designated as a grocer </a>by the UK's Competition and Markets Authority in 2019.)<div type="image" title="A technician's work area is seen at the Ocado CFC (Customer Fulfilment Centre) in Andover, Britain May 1, 2018. Picture taken May 1, 2018. REUTERS/Peter Nicholls" height="1087" width="2174" msid="76920566" hostid="261"></div>Nowhere has Ocado's performance as been more apparent than at its warehouses.Inside these warehouses, known as Customer Fulfilment Centres, <a href="https://www.youtube.com/watch?v=4DKrcpa8Z_E">cuboid "Bots" whizz back, forth, and side to side on grids known as "The Hive,"</a> depositing supermarket produce from orders.A 50-item order can be sorted by a bot, which travels through The Hive at a speed of eight meters per second, and is complete in a matter of minutes.Ocado is also transitioning from a reliance on human produce-pickers to robots. "As we continue, we will see a greater proportion of the range picked robotically," said Jensen. He envisions "a tipping point where you get a payback with the cost of a robotic picking station versus the cost of a year of labor.""We don't do vanity tech projects," Jensen said. "We do projects because they work and they pay back."Here's what an Ocado warehouse in Andover, England, looked like in 2018:Ocado has also invested in <a href="https://www.businessinsider.com/food-investment-vertical-farming-2017-8?r=US&amp;IR=TIR=T">vertical farming</a>, billed as a more sustainable and profitable way of growing vegetables indoors. He sees Ocado's warehouses ultimately being built alongside vertical farm facilities, which would dramatically lower costs and speed up deliveries of fruit and vegetables.Botham, of Kantar, told Business Insider that the days of Ocado being a retailer are long gone."They see themselves as a solutions business," he said. "That's where they think their money is."

How Ocado went from understated British grocer to an $18.4 billion tech giant, as the coronavirus pandemic confirms the future of grocery shopping is online

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ICA Gruppen seeks Infosys help to revitalize its IT operations

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Online grocer Ocado is vying with supermarket giant Tesco to be the UK's most valuable retailer

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How Ocado went from understated British grocer to an $18.4 billion tech giant, as the coronavirus pandemic confirms the future of grocery shopping is online

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