Kroger opens fast delivery center in Indiana

The Kroger Co. is extending its flexible, vertically integrated Kroger Delivery network to the Indianapolis market.

The grocery giant is opening a 48,000-sq.-ft. facility in Indianapolis which will collaborate with a high-tech customer fulfillment center (CFC) hub in Monroe, Ohio to fulfill online orders of fresh food. Introduced in partnership with U.K.-based online grocer Ocado in May 2018, the CFC model combines vertical integration, machine learning, and robotics with affordable and fast delivery service for fresh food. 

The CFC facilities leverage proprietary technology solutions focused on artificial intelligence (AI) and advanced robotics and automation to create more seamless and efficient fulfillment, picking and delivery capabilities for enhanced digital commerce capabilities across the U.S.

CFC also represents one of the models engineered for the grocer’s flexible, vertically integrated Kroger Delivery network, which also includes smaller automated facilities and spoke locations, such as the new Indianapolis facility. In CFCs, more than 1,000 robots traverse giant 3D grids, orchestrated by proprietary air-traffic control systems in the unlicensed spectrum. The grid, known as The Hive, contains totes with products and ready-to-deliver customer orders.

As customers' orders near their delivery times, the robots retrieve products from The Hive, which are presented at stations for items to be sorted for delivery via an algorithmic sorting process. For example, fragile items are placed on top, bags are evenly weighted, and each order is optimized to fit into the fewest number of bags, reducing plastic use.

Once completed, orders are loaded into a temperature-controlled Kroger delivery van, which can store up to 20 orders. Machine learning algorithms dynamically optimize delivery routes, considering factors like road conditions and optimal fuel efficiency. 

At launch, customers in 35 Central Indiana ZIP codes, mostly in the Indianapolis area, will be eligible for Kroger Delivery. Richmond, Ind., which is near the "hub" in Ohio, is also part of the coverage area. The delivery network will also continue to leverage stores and third-party partners to deliver certain orders.

“We're proud to welcome the Kroger fulfillment network to Indiana," said Colleen Juergensen, president of Kroger's Central Division. "The new service is a wonderful addition to the expanding digital experience available to Kroger customers. The network's delivery spoke will provide unmatched customer service and improve access to fresh food in areas eager for the variety and value offered by Kroger."

"This fulfillment center is another example of how Kroger is transforming e-commerce in the grocery industry using a vertically integrated network to provide a reliable and consistent delivery service that repeatedly receives favorable customer feedback like a best-in-class Net Promoter Score. Our expansion in Indiana represents our commitment to delivering fresh, affordable food in both existing and new geographies," said Bill Bennett, Kroger VP and head of e-commerce. "As our e-commerce business accelerates, we're excited to continue expanding our reach and loyalty by delivering our customers an exceptional service for as little as $6.95 powered by high-tech facilities."

The Indianapolis fulfillment center will create up to 150 jobs and is currently hiring associates for various roles, including delivery drivers.

Kroger unveiled the Monroe fulfillment center in April 2021, its first, followed by another in Groveland, Fla. The fulfillment network plans additional sites in California, Dallas, Forest Park, Ga. (Atlanta), Frederick, Md., Phoenix, Pleasant Prairie, Wis., Romulus, Mich. (Detroit), as well as South Florida and the Northeast.

[Read more: Kroger plans Northeast entry with next-gen fulfillment centers]