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Supply Chain News: Automated Distribution Center of UK On-Line Grocer Turns Systems Provider Burns to the Ground


Damage Exceeds 100 Million Pounds, Raises Questions about Cause of Blaze

Feb. 20, 2019
SCDigest Editorial Staff

Here's an odd story.

We've covered news about a company called Ocado several times in SCDigest.

Supply Chain Digest Says...

A report in The Times newspaper quoted an unnamed fire-fighter saying robots were still moving on a grid when they entered the complex.

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The company is one of the UK top on-line grocers, but after building a robotic picking system for itself, it has now also become a supplier of the technology to other grocers.

Kroger, for example, has committed to three new automated ecommerce DCs that will not only use Ocado's system, but will also have Ocado running the facilities for Kroger.

The first of the new DCs is being constructed in Munroe, OH, about 30 miles north of Kroger's headquarters in downtown Cincinnati. Then just this week, Kroger announced the next two of the Ocado DCs will be built in the Central Florida and the Mid-Atlantic regions.

But two weeks ago, a major fire totally destroyed the company's flagship distribution center in Andover, Hampshire. The savage blaze burned for more than 48 hours, required 200 firefighters to bring it under control, and reduced the 45 million pound building to a twisted, smoldering hulk, as you see in the image below.

More than 200 homes were evacuated as a result of the blaze and fears of toxic fumes.

Andover was not just any old distribution center - it was the prototype for Ocado's robotic vision, with an army of 600 robots swarming over a 3D frame called the "grid" to locate goods and deliver them for orders.

It was said to be capable of processing 65,000 separate orders per week.



Source: Sky News

The loss from the fire has been reported as exceeding 100 million pounds.

(See More Below)



Rather humorously from our view, several UK newspapers reported that Ocado had to cancel many customer orders as a result of the blaze. No kidding.

Also interestingly, Ocado was forced to deny that robots were moving around its flagship complex at Andover in southern England when firefighters tackled a blaze.

According to Reuters, a report in The Times newspaper quoted an unnamed fire-fighter saying robots were still moving on a grid when they entered the complex, hampering their efforts.

However, Ocado said the warehouse robots were immobilized by a safety system as soon as the fire alarm was activated.

Ocado stock price fell sharply on the news, losing some $1 billion dollars in market cap for awhile. While Ocado's stock price has somewhat recovered, the market concern is that the blaze was somehow cause by the Ocado system itself, with the official cause of the fire still unknown.

Hampshire Fire and Rescue Service (HFRS) also did not recognize the firefighter's quote. "There will be a full and thorough investigation into the fire working with the owners to determine the cause and see if any lessons could be learned for the future," said HFRS Deputy Chief Fire Officer Andy Bowers.

Do we need to look more closely at risks from highly automated DCs? Let us know your thoughts at the Feedback section below.




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