Kroger expands presence in South Florida with new spoke facility
How the hub-and-spoke system works, according to Kroger:
- Orders are picked and packed by employees at the Groveland fulfillment center.
- Kroger employees place the orders in climate-controlled vehicles headed toward Miami.
- Orders arrive at the new spoke facility, where they’re checked and placed on refrigerated trucks.
- Orders are delivered from the spoke facility directly to customers’ homes.
"We've been working closely with the Kroger team since they started looking to expand to South Florida and knew this was a geography that would offer significant growth potential," said James Kohnstamm, executive vice president of the Miami-Dade Beacon Council, in the release. "From a customer standpoint, we have over a million households and hundreds of new residents relocating to Miami each week."
Kroger’s presence in South Florida is a product of a collaboration with the Ocado Group, a U.K.-based company specializing in e-commerce grocery delivery. Kroger and the Ocado Group first partnered in 2018 to use artificial intelligence, robotics and automation in Kroger’s fulfillment and spoke centers. The technology used in the facilities includes 1,000 robotsthat move around the facility in a 3D grid, called “The Hive” by the grocer. The bots bring the items to employees for picking, and they use algorithms to ensure products are appropriately packed (fragile items on top, for example). The technology also helps Kroger ensure each order is packed using the fewest number of bags possible — without becoming too heavy — to reduce plastic use.
Kroger last year announced plans to merge with rival grocer Albertsons in a move that still needs to be approved by federal regulators. If approved, the combination would make Kroger-Albertsons the second-largest food retailer in the U.S., putting it in closer competition with Walmart.