Ocado sales rise 25% despite consumer slowdown

Ocado has posted a 25% rise in sales in the past three months, despite a slowdown in consumer spending which has hit other retailers hard. The online grocer said more people were visiting its site and shopping more frequently, although this has led to a drop in basket size, down 1.1% in the 12 weeks to 20 February. Ocado will soon face increased competition from Waitrose, which is relaunching its home delivery service in the battle for affluent customers in the south east. Waitrose, which is owned by John Lewis, will also compete directly with Ocado inside the M25 for the first time. Gross sales at Ocado climbed 24.7% to £146.2m in the quarter while average orders per week were up 26.1% to 103,207 from 81,823 in the same period last year. The average order size fell to £118.06 from £119.38. "Despite the economic headwinds in the UK, more and more consumers are seeing the benefits of online grocery shopping and we are increasing capacity to meet this demand," said Tim Steiner, Ocado's chief executive. Waitrose reported a 6.2% in half-term sales to £94.9m this morning. Although the weather was mixed, sales of picnic-style foods and sandwich fillings shot up last week as families enjoyed the first school break of the year. Sales at John Lewis department stores climbed 7.2% to £54m compared with the same week last year, boosted by childrenswear and women's clothes, with children's shoe sales up 69%. Half term south of the border was a week later than last year. Overall, fashion led the way, up by 10% with the warmer weather helping the new spring ranges. Electricals and home technology sales were up 6% driven by small electrical items and IT and accessories, while home sales were up by 5%. Johnlewis.com had another good week with sales up by 24.5%, including fashion jumping by 50%. "We remain cautious on the general retail sector over the first half, with interest rate increases on the horizon," said Freddie George, a retail analyst at Seymour Pierce.