Why your Ocado shop beat grocery inflation this year
Key Points
- Ocado's average item price rose 2.1% against UK grocery inflation of 3.9%
- The average basket cost £126.55, up just 1.9%, with items per basket flat at 44.3
- Warehouse costs of 5.7% of sales helped fund the price restraint
- Ocado remains the UK's fastest growing grocer with 13.7% of the online market
- Ocado Retail still doubled its earnings to £72.9m
Ocado Retail limited its average selling price increase to 2.1% in the first half of 2026, far below UK grocery inflation of 3.9%.
The figures come from Ocado Group’s half year results, published on Thursday (16 July), which cover the 26 weeks to 31 May 2026 and include the performance of Ocado Retail, the online supermarket it runs as a 50:50 joint venture with M&S.
Ocado Retail’s average selling price rose to £2.86 per item from £2.80 a year earlier. Over the same period, Nielsen measured UK grocery inflation at 3.9%, meaning Ocado shoppers absorbed roughly half the price pressure hitting the wider market.
The average Ocado basket cost £126.55 in the half, up just 1.9% year on year, while the number of items per basket held steady at 44.3. Customers bought the same amount of food and paid only marginally more for it.
Shoppers appear to have noticed. Ocado’s average active customer base grew 10.6% to 1,281,000, orders rose 12.8% to 554,000 per week, and revenue climbed 15.1% to £1.76bn. Nielsen data shows Ocado remains the UK’s fastest growing grocer over the past 12 months, with its share of the online grocery market up 0.7 percentage points to 13.7%.
How Ocado holds prices down
The company’s warehouse economics explain how it kept price rises below the market. Total fulfilment centre costs, including labour, came in at just 5.7% of sales, a figure Ocado says sits far below traditional supermarkets running stores.
Robot picking technology drove much of that. Labour productivity across Ocado’s automated warehouses rose 11.3% to 267 units picked per hour, and warehouse costs grew only 1.7% despite orders rising 12.8%.
Ocado also leaned on supplier funded media income of £51.9 million and issued £16.5 million in discount vouchers to customers during the half, up from £13.5 million a year earlier.
The restraint on prices did not come at the expense of profit. Ocado Retail’s adjusted EBITDA more than doubled to £72.9 million from £33.3 million, and the business recorded a pre-tax profit of £12 million against a £17 million loss last year.
