Ocado becomes first large grocer to warn of 'missing items'

Suban Abdulla
·2 min read
Chorleywood, Hertfordshire, England, UK - July 2nd 2020: Ocado home delivery van supplying groceries during the Coronavirus (COVID-19) pandemic
Ocado warned customers that “changes to the UK supply chain have affected some of our suppliers and may result in an increase in missing items and substitutions over the next few weeks.” Photo: Getty

Online grocer, Ocado (OCDO.L) has become the first big online retailer to warn of “missing items” and “increased substitutions” in some products, as coronavirus linked staff absences hit supply chains.

The online supermarket has been a lifeline for shoppers hoping to avoid the risk of walking around a supermarket due to COVID-19 and social distancing measures.

Ocado warned customers that “changes to the UK supply chain have affected some of our suppliers and may result in an increase in missing items and substitutions over the next few weeks.”

But, while it has been affected by employees taking ill with the virus or self-isolating, Ocado says that plenty of food should be available even if customers might not get their exact product choice.

"Staff absences across the supply chain may lead to an increase in product substitutions for a small number of customers as some suppliers consolidate their offering to maintain output," a company spokesperson said.

READ MORE: UK businesses call for more support to cope with third lockdown

The news comes after supermarkets saw a rise in online food orders, as shoppers try to stay at home as the new lockdown started. Shoppers reported issues with Sainsbury's (SBRY.L) and Tesco (TSCO.L), while Ocado customers were placed in a virtual queue, after Boris Johnson’s press conference on Monday.

The third lockdown has seen other firms warn on the impact on sales.

Last week, bakery chain Greggs (GRG.L), Topps Tiles (TPT.L) and Auto Trader (AUTO.L) warned of the hit to trade from COVID-19 restrictions due to England’s lockdown.

Greggs told investors it did not expect profits to return to pre-COVID levels until 2022 “at the earliest,” highlighting uncertainty over how long social restrictions will last.

Meanwhile, industry bosses also called for extra government support to help firms brace for the third lockdown, which has strict stay-at-home orders across the UK.

Companies warned they face hardship and said job losses could rise significantly in some industries as businesses adapt to the “body blow” of fresh restrictions.

Helen Dickinson, chief executive of the British Retail Consortium, said testing and a rapid vaccine rollout were key to “bringing to an end this cycle of lockdowns.” She also called for business rate relief extension beyond April.

Retailers are set to lose £2bn ($2.7bn) a week in sales, Dickinson said, adding that 178,000 retail jobs had already been lost in 2020.

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