Mel Smith Ocado CEO

Mel Smith

Ocado has picked up a third more active customers in the past year, but has warned that cost price increases are making for a difficult trading environment.

The online retailer issued a first-quarter trading statement for the 13 weeks to 27 February, and revealed that active customer numers rose 31 per cent year on year to 835,000. Customer orders grew by 11.6 per cent.

However retail revenue was down 5.7 per cent to £564.7m as customer behaviour returned to more pre-pandemic patterns, with average basket size down 15 per cent at £124.

Chief executive Mel Smith underlined that significant increases in raw materials and product cost prices, energy, utilities and dry ice through Q1 have added further cost headwinds for the grocery industry.

The retailer has been working closely with suppliers to actively manage the inflation level, as well as increasing prices where costs could not be mitigated 'in line with the rest of the market, and will continue to monitor the market to ensure alignment on prices and delivery of fair value to customers', Smith added.

'The scale of food price inflation over the course of this year, coupled with the overall level of market demand as the cost of living increases, particularly rising energy costs, is difficult to predict,' Smith continued.

'We intend to continue to offer the best possible value to customers while recognising the overall level of pricing in the market. These uncertainties over inflation, which have increased significantly in recent weeks due to the war in Ukraine, the overall level of market demand, and the continued return to pre-Covid shopping patterns, mean that while easier comparatives, strong customer demand, and further growth in capacity, should see revenue growth end the year in the high-teens, the full-year growth rate may be closer to 10 per cent.'