Ocado has responded to criticisms that its internally-developed technology, which it is building as a platform for international expansion, is not unique.
Last week, analysts at Redburn downgraded the online groceries retailer from ‘buy’ to ‘sell’ after it questioned the company’s claims of being an innovative technology developer and its ability to be profitable. To back up its claims, Redburn said that it had found only one European patent, for a robot arm, belonging to Ocado in a patents database.
In a statement to ComputerworldUK, Ocado said: “There is often an 18-month delay in the patents register so not all the patents being filed by Ocado show up. There are around 14 in Ocado’s case that the Redburn analyst would not have seen.”
According to the Financial Times, Redburn said that the robot arm “appears to sit on top of” an automation system called Autostore from automation systems provider Swisslog. Ocado argued that this did not mean that its technology was not unique.
“Ocado use Autostore for its non-food delivery but it is not used by Ocado - or anyone else I am aware of - for grocery, which is where Ocado’s key competitive advantages and proprietary technology lies,” a spokesperson for the company said.
In addition, Redburn analyst James Tracey said that Ocado, despite signing deals such as the 25-year joint venture to provide Morrisons with its online groceries IT platform, “has not generated positive [pre-tax earnings] or free cash flow in its history and is unlikely to do so for the next four years”.
Paul Clarke, Ocado’s CTO, told ComputerworldUK in a recent interview that shareholders understood the “long-term” journey Ocado is on, to build a technological platform that can be rolled out for food and non-food groceries in other countries, not just the UK.