Ocado stops new customers signing up as demand soars

Ocado stops new customers signing up as it struggles to cope with demand and most supermarkets say online orders won’t be delivered for three weeks as government identifies delivery drivers as ‘key workers’

  • Ocado has stopped new customers from signing up following a surge in orders 
  • The business revealed that it has seen a huge increase in trading this year 
  • All supermarkets have faced a major upswing in demand for some items

Britain’s biggest online-only supermarket, Ocado, has stopped new customers from signing up as the business is overwhelmed by orders from people staying indoors to avoid the coronavirus pandemic.

The retailer revealed today that it has seen a massive increase in trading since the three-month period ending March 1.

All supermarkets have faced a major upswing in demand for some items, with shelves emptied of toilet paper, many canned goods and cereals. Most are still taking online orders but they will not be delivered for up to three weeks.

Ocado said it was working with suppliers to increase stock in some categories.

‘The impact of higher basket values and order demand, amid growing public concern over the coronavirus, was limited in the (first) quarter, although this has since picked up significantly and growth in the second quarter is so far double that of the first quarter,’ said Ocado Retail chief executive Melanie Smith.

Ocado had temporarily shut down its website to give itself breathing space amid ‘unprecedented strain’ as orders streamed in from new and old customers.

Ocado´s delivery service has been overwhelmed by the number of new orders (file image)

However, despite this major increase, Ocado sounded a cautious note, keeping its financial guidance steady for the year, as an increase now could give way to a fall later, as customers burn through their stockpiles.

‘We expect the impact of forward-buying, however, to unwind at some point,’ Ms Smith said.

She added: ‘I am tremendously proud of my colleagues and the outcomes we have achieved in the first quarter. I am confident that our resilience, teamwork and commitment will stand us in good stead to continue to deliver for our customers even with the current uncertainties.’

Environment Secretary George Eustice said there is ‘significant resilience in our food supply chain’ and that there is not a shortage of food.

He said: ‘There isn’t a shortage of food, the challenge that we’ve had is getting food to shelves in time when people have been purchasing more.

‘That’s why we have taken steps including setting aside delivery curfews so that lorries can run around the clock, relaxing driver hours to ensure the deliveries can take place more frequently and we are in discussions with other Government colleagues in MHCLG around other support that we would deliver locally to get food to those who are self isolating.’

Shadow environment secretary Luke Pollard said ‘there are millions already in food poverty and this is now an immediate family emergency for many of those’.

He added: ‘With food banks running low on food, many volunteers of food banks over the age of 70 and soon needing to self-isolate, what steps is he taking to assist those in genuine hunger today?’

Mr Eustice replied: ‘I’ve been in regular, daily calls with the food supply sector that included discussions around food banks and we are in dialogue with supermarkets to ensure we can make sure they get access to the supplies that they need.’

Ocado Retail’s revenue jumped by 10.3% to £441.2 million in the first quarter of the year, which Ms Smith said was largely not affected by the spread of Covid-19.

Ocado has closed down access to its website until Saturday as it struggles to deal with demand due to stockpiling during the coronavirus outbreak. Shoppers will not be able to edit an existing order or book a new delivery for the next few days

‘However coronavirus unfolds, what is clear is that the fundamentals at Ocado Retail are strong,’ she said.

The supermarket also said it is ‘on track’ to switch over its partnership with Waitrose to instead deliver Marks & Spencer goods.

As part of the deal for Ocado to deliver for M&S, the high street giant took a 50% stake in its online peer for £750 million last year.

The average number of orders placed on Ocado jumped 10.2% to 343,000, while the average order value was up by just 28p to £110.24.   

Ocado has closed down access to its website until Saturday as it struggles to deal with demand due to stockpiling, and shoppers will not be able to edit an existing order or book a new delivery for the next few days. 

The online supermarket said it will be out of action until March 21 due to ‘a simply staggering amount of traffic’. 

The announcement comes as some supermarket chains have started to impose strict rationing measures on items such as toilet roll, soap and UHT milk to curb Covid-19 panic-buying. 

The online supermarket said it will be out of action until March 21 due to ‘a simply staggering amount of traffic’. The announcement comes as some supermarket chains have started to impose strict rationing measures on items such as toilet roll, soap and UHT milk to curb Covid-19 panic-buying. (File photo)

Ocado said the closure will enable it to carry out essential work that will help to ensure distribution of products and delivery slots is as fair and accessible as possible for all customers going forward.

A message on the company’s home page, from Melanie Smith reads: ‘Like all supermarkets, we are working round the clock to keep up with high demand and make sure all of our customers get what they need at this time – especially those more vulnerable and in isolation.’

Customers stocking up across the country is intensifying as supermarkets under mounting pressure are taking drastic rationing action in a bid to deal with the unprecedented demand for goods.

Tesco, the UK’s biggest supermarket, will impose restrictions on all customers to buying a maximum of three products per line from Thursday, as it copes with the high demand from the coronavirus pandemic, the company announced.

Britain’s grocery industry has struggled for over a week to keep shelves stocked in the face of stockpiling, which worsened on Tuesday despite weekend appeals for calm from supermarket bosses and politicians.  

But experts have asked why supermarkets have introduced different limits on certain goods, creating confusion for customers and competition among rivals.

It comes as Ocado shoppers have been sharing stories about how their entire grocery orders have been cancelled without notice. 

Some affected customers said they only discovered their groceries weren’t coming after logging on to Ocado’s overstretched website – where getting access to an account has taken over 30 minutes. 

Yesterday a message from the company’s CEO Melanie Smith went out to customers, apologising for the delivery issues and revealing that the Ocado app would be temporarily taken offline due to ‘performance issues’. 

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Frustration: Many Ocado shoppers reported not receiving their orders, with no warning

On Mumsnet earlier this week, one shopper revealed she’d had no warning about her order not arriving and said she felt she now was more likely to panic buy because she had no food

‘You will not be able to edit an existing order’: The full statement from Ocado

Like all supermarkets, we are working round the clock to keep up with high demand and make sure all of our customers get what they need at this time – especially those more vulnerable and in isolation.

As a result, we have made a decision to temporarily close access to Ocado.com so you will not be able to edit an existing order or book a new delivery for the next few days.

This temporary closure will allow us to complete essential work that will help to make sure distribution of products and delivery slots is as fair and accessible as possible for all our loyal customers.

We are fully booked for the next four days. If you have a delivery booked for Thursday or Friday, cut-off times for editing these orders have already passed, but your driver will still arrive as expected.

Customers with an existing order booked for delivery from Saturday onwards will be contacted later this week with details of how to edit their orders. We will reopen the website to all customers from Saturday.

We are very sorry to cause any inconvenience. We’re managing a simply staggering amount of traffic to our website right now and more demand for products and deliveries than we can meet. Our first priority has to be to keep our service up and running and to play our part in feeding the nation.

I’d also like to take this chance to thank our amazing drivers and warehouse staff who are working tirelessly to deliver groceries to as many people as possible in these uncertain times. Their dedication and hard work is truly amazing.

Thank you for your patience and understanding at these unprecedented and challenging times.

Melanie Smith, CEO, Ocado Retail

The Ocado app has been shut down due to technical issues, the company told shoppers today

Smith also pleaded with shoppers not to panic buy, saying: ‘Only buy what you need, there’s enough for everyone. That will help us to make sure everybody gets what they need.’ 

On social media site Mumsnet, one shopper affected by the Ocado cancellations said that they now felt they would be more likely to panic buy after not receiving food they’d spent time ordering. 

Vagessence wrote: ‘My whole ocado shop for today has been cancelled. Thankfully we’ll be able to drive to the shops but what about those who can’t? People in self isolation or those who have to rely on online shops for other reasons? Slots aren’t available until next week, midweek at the earliest!’

They added: ‘I’ve been telling myself to stay calm, only buy what we need, don’t add to the problem of shops being out of stock. But now I’m panicking it’s really hard to stick to that. I’m now not sure if I’ll be able to hold back from panic buying now.’

Elsewhere, on Twitter, others reported similar problems. 

@Hegark wrote: ‘I have been charged for an order that wasn’t delivered on Monday 16th. Have emailed and Sent DM. Please refund me #Ocado.’  

@clairebaty added: ‘You have cancelled my reserved order for this Sunday for apparently a payment issue but my payment info was up to date already. Please can you reinstate this immediately?’  

@theblindblonde added: ‘I have dm’d you about a delivery which has not arrived! Please help’ 

@ClaireJ29033154 wrote: ‘I was expecting my @Ocado delivery Monday and it never arrived and not heard anything and can’t get in touch with them either! The payment is pending out my account too and have 6 in my family to feed.’

Empty pasta shelves in Tesco in Ely, Cambridgeshire, at 8am – just two hours after the store opened today

Others praised the service for continuing through difficult times.  @LizzyNinn wrote: ‘Thanks. My order arrived on time as usual, nothing missing, pleasant chat with the driver. All totally normal. I know it’s taking a lot of extra work to achieve this, so thank you.’   

All the major supermarket chains have been affected by the deepening coronavirus crisis. Sainsbury’s has announced it is closing its in-store meat, fish and pizza counters and cafes from tomorrow to free up lorry and warehouse capacity, as well as shelf-stacking time, for essential items to be replenished.

The supermarket will restrict people to only buying three of any single grocery item, in addition to a two-item limit on the most popular goods such as toilet paper and long-life milk which is already in place. From March 23, disabled customers and those over 70 will take priority for online delivery slots.

Morrisons plans to create 3,500 new jobs and expand its home delivery operation to help it deal with coronavirus.

Aldi became the first UK grocer to introduce rationing, limiting customers to buying four items of any one product during each visit.

Tesco followed suit by limiting shoppers to five items, and Asda has introduced a limit of three items while Iceland will only open to elderly, vulnerable and disabled shoppers on Wednesday mornings.

Despite the stringent new measures, shelves at a Tesco supermarket in Ely, Cambridgeshire, were stripped bare just two hours after the store opened this morning.

And customers at an Asda Walmart in Waterlooville, Hampshire, were queuing outside the door at 6am this morning and within just one hour, shoppers claim shelves were empty as worried households continue to stockpile against government advice.

NEW OPENING HOURS, STRINGENT LIMIT ON GOODS AND MORE JOBS: SUPERMARKETS REACT TO CORONAVIRUS CRISIS

Tesco  

Rationed the sale of anti-bacterial products, dried pasta, tinned vegetables, toilet paper and tissues to five packs at a time. 

Limit for key products; disinfectants, hand sanitisers, long life milk, tinned vegetables and pasta, cut from 5 to 2. 

It was forced to take its mobile app offline temporarily due to high demand on Tuesday, and announced it would be reducing the hours of all of its 24-hour stores to 6am to 10pm. 

Waitrose  

Limit of between 2 and 12 units across 400 products, mainly toiletries, cleaning products, tinned food and pasta. 

The supermarket also said it was drafting in 1,200 staff ‘and growing’ from sister retailer John Lewis to help it cope with demand.  

Morrisons  

Rationed purchases on 1,250 items.  

Limit of 2 per customer for toilet rolls, tissues, hand sanitisers; 4 for baby milk formula, bars of soap, handwash; 6 for bleach and other cleaners. 

Shoppers seeking a Morrisons home delivery have been instructed to tell the store if they are self-isolating so goods can be left on the doorstep.

Creating 3,500 jobs to meet surging demand for its home delivery service.

Recruiting 2,500 pickers and drivers while hiring about 1,000 people to work in distribution centres.

Plans for new call centre for those without access to online shopping, plus the launch of a new range of simple-to-order food parcels from next Monday.

Asda 

Restricting all customers to buying up to three items on all food, toiletries and cleaning products.

The limit will not apply to fresh fruit/vegetables. 

Close cafes and pizza counters to free space and staff to help keep shelves fully stocked.  

Temporarily reduced opening hours of all its 24-hour stores, so they will be closed between 12am and 6am each day for re-stocking.

Sainsbury’s  

Limiting shoppers to three items.  

Restrictions include: 

3 meats

1 pack of toilet roll

2 large boxes of eggs

2 multi packs of tinned soups and veg

3 pasta packs

1 hand sanitiser

A cap of two is going to be imposed on the most popular items, such as toilet roll, soap and UHT milk. 

All its stores will only open to the elderly and vulnerable for the first hour of trading on Thursday, but will open for an hour longer so other shoppers do not miss out. 

Meat, fish and pizza counters and cafes are being closed from Thursday to free up lorry and warehouse capacity, as well as shelf-stacking time, for essential items to be replenished. 

Plans in place to beef up ‘click and collect’ service, and these two groups will be given priority access when new slots become available.

Iceland 

Temporary quantity restrictions on essentials.

Supermarkets allowed elderly customers exclusive use of the shop between 9am and 11am before the general public were allowed in. 

The scheme, which will run every Wednesday until further notice, has been rolled out at Iceland stores across the country.

In Boots, bottles of children’s paracetamol Calpol were being sold at only one at a time. 

Co-op

Limit of 2 per customer on essentials including hand sanitiser, soap, antibacterial wipes, toilet/kitchen roll, tinned goods, pasta, rice, Long Life milk, sugar, baby items. 

Aldi

Limit of 4 units for every product from milk and bread to baked beans.

Lidl

Quantities may be restricted to 6 per customer.

Ocado

Limit of 2 for antibacterial handwash, hand sanitiser, antibacterial cleaning sprays and wipes, tissues, toilet roll and kitchen roll.

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