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Ocado’s share price is back where it started. Are its robots just too fancy?

about 2 hours ago
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That’s quite a stock market journey: from 180p at listing 15 years ago to the mighty heights of £29 during the locked-down Covid year of 2020 and now – oh dear – all the way back down to 180p.Welcome to Ocado, which looked like the future of grocery retailing once upon a time but now seems to be struggling to convince its most important customer of the virtues of robots and automation.There is no positive gloss to put on news that Kroger, the US supermarket chain, is closing three of its eight warehouses that use Ocado’s technology.Kroger was the client that put a rocket under the UK group’s share price in the first place in 2018 by signing a partnership deal.If Ocado could prove the worth of its kit in the world’s largest consumer market, went the bulls’ argument, valuation doubts would disappear.

In the event, the strain in the relationship has been showing for a while.But, when it came on Tuesday, the result of the US company’s review of its e-commerce operations was worse than feared from Ocado’s point of view.It wasn’t just the three closures, but also Kroger’s positive words about expanding its use of alternative delivery merchants – the likes of DoorDash, Instacart and Uber Eats.Therein lies the great philosophical divide in the world of online groceries.Ocado’s model is capital intensive and requires heavy investment in automated warehouses, state-of-the-art robots and refrigerated vans.

The other setup is cheap, cheerful and, at its crudest, involves picking the goods off the shelves in a regular store and getting them to the punters as fast as possible via people on bikes.In truth, there’s room for both approaches and others in between – but the debate has always been about how much room for each model.The crushing aspect of Kroger’s analysis is that it seems to be saying that Ocado’s high-spec formula works only in “higher-density” locations.Even then, it added it will be “monitoring the remaining facilities’ performance”.It is all a very long way from the original Kroger/Ocado vision of building 20 warehouses in the US.

Sign up to Business TodayGet set for the working day – we'll point you to all the business news and analysis you need every morningafter newsletter promotionAttempting to whistle cheerfully, Ocado said it still “expects significant growth in the US market” – but, to state the obvious, it needs to explain how significant and how it’s supposed to happen,The only small consolation is that Ocado gets $250m (£190m) in compensation for the early closures,Sadly, a full-throated endorsement from Kroger would have been worth far more,Back in 2020, when the pandemic forced everyone to log on, Ocado co-founder and chief executive Tim Steiner crowed that “a dramatic and permanent shift towards online grocery shopping” was taking place,It sounded hubristic when he said it – and the prediction has not improved with time.

The UK operation, now a joint venture with Marks & Spencer, remains the fastest-growing grocery format on the home front,The customers love it,But the investment story for the shareholders – and the reason why the ultra-patient core group has remained loyal through the long loss-making years – has been about turning Ocado into a technology company,The eventual prize would be annuity-like revenues from licensing the proprietary technology to supermarkets around the globe,Ocado has other overseas customers, but Kroger was the most important in the expansionary story.

The closure of warehouses in Maryland, Wisconsin and Florida on financial grounds is “a smelling salt moment” for the group, argued arch-Ocado bear Clive Black of Shore Capital.It’s hard to disagree.Steiner needs to address the burning question: is Ocado’s engineering so good and so state-of-the-art that it’s too expensive for mass adoption?
foodSee all
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How to make risotto alla milanese – recipe | Felicity Cloake's Masterclass

Risotto alla milanese is, like the city it calls home, elegantly simple, but very rich. The saffron that gives the dish its striking colour is rightly expensive (it takes about 150 flowers to produce a mere gram), but you don’t need much and, though it’s often served alongside osso buco, I think it makes a fine meal on its own with a bitter-leaf salad.Prep 5 min Cook 30 min Serves 41 onion 75g butter, or 15g butter plus 60g bone marrow350g risotto rice (carnaroli, arborio, vialone nano)1 litre beef stock, or chicken or vegetable stock75ml dry white wine (see step 4)1 level tsp saffron threads75g finely grated parmesan, or grana padano or a vegetarian alternativePeel and finely chop the onion; the aim is for it almost to disappear into the dish, rather than remaining as distinct chunks, so take your time over doing this (you could substitute two shallots, if you prefer – their sweetness works particularly well with the flavour of the wine and cheese).Melt a generous tablespoon of the butter in a frying pan set over a medium-low heat, then fry the chopped onion until soft, golden and limp, but not coloured.Turn the heat up to medium-high, add the rice and fry, stirring constantly, until the grains are hot and starting to turn translucent around their edges

2 days ago
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2210 By Natty Can Cook, London SE24: ‘Much more than just posh jerk chicken at fancy prices’ – restaurant review | Grace Dent on restaurants

There’s an attention to detail in every dish that makes this place more than fit for a special occasionIt’s 6pm in Herne Hill, south-east London, and I’ve popped out for some Caribbean food wearing fancy athleisure wear. Yoga trousers and a smart hoodie, but PE kit nonetheless. And, once I arrive at 2210 By Natty Can Cook, I realise I am severely underdressed.When chef Nathaniel Mortley announced that he was opening a restaurant that aimed to celebrate Caribbean culture “in style” and to win a Michelin star, his loyal Instagram following, as well as their families and friends, took the brief and dressed accordingly. As fancily plated ackee and saltfish spring rolls passed by, as well as a lot of rum punch, I rustled in my handbag for some bigger earrings and more makeup

3 days ago
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‘Simple, well-crafted and excellent’: supermarket chutneys, tasted and rated | The food filter

Our resident taster dipped, spread and dolloped his way through 10 chutneys in time for Christmas, so you don’t get in a pickle choosing one for yourself The fair price for 14 everyday items, from cleaning spray to olive oilThe Guardian’s journalism is independent. We will earn a commission if you buy something through an affiliate link. Learn more.Chutney is a heritage recipe that’s been largely unchanged for a century, and some of the best versions are the simplest and most traditional. That said, even when it’s made on an industrial scale, chutney usually features just fruit, sugar, vinegar and perhaps some pectin

3 days ago
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It’s not all about roasting on an open fire – there’s so much more you can do with chestnuts

If I’d ever spared a thought for how chestnuts – the sweet, edible kind, not the combative horsey sort – were harvested, I would probably have conjured rosy-cheeked peasants bent low in ancient forests and filling rough-hewn hessian sacks by hand. Back-breaking labour, sure, but so picturesque!I was delighted, therefore, while on a writing retreat in Umbria last month, to get the opportunity to watch an elderly couple manoeuvre a giant vacuum around their haphazard orchard, followed by their furious sheepdog. The fallen crop was sucked into a giant fan that spat their bristly jackets back out on to the ground, and the nuts then went to be sorted by other family members on a conveyor belt in the barn – the good ones to be sold in the shell, the less perfect specimens swiftly dropped into a bucket for processing.Later in the week, a lorry turned up in the village square to pick up bags from other small local producers, and that evening I roasted a pan of chestnuts on the fire with new appreciation, while loudly bemoaning the disappearance from the streets of London of the chestnut sellers of my childhood (though this makes me sound positively Dickensian, I can confirm that I’m talking about this century. Note also that Nigel Slater is less starry-eyed on the subject

4 days ago
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Benjamina Ebuehi’s recipe for apple, brown butter and oat loaf | The sweet spot

I adore a good loaf cake. There’s something about them that’s just inherently cosy and wholesome, and this one in particular is perfect for the colder months, not least because it’s simple and sturdy in the very best way. It’d be right at home with a coffee for breakfast, as well as gently warmed in a pan with butter and served with hot custard on a rainy evening. A real all-rounder.Prep 5 min Cook 1 hr 25 min Serves 8180g unsalted butter 200g light muscovado sugar 2 large eggs 50g soured cream 210g plain flour ½ tsp cinnamon 40g porridge oats, plus extra to finish1½ tsp baking powder ¼ tsp salt 2 eating apples 2 tbsp demerara sugarHeat the oven to 180C (160C fan)/350F/gas 4 and grease and line a 2lb loaf tin

5 days ago
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Kids have a wobble in the face of rabbit jelly | Brief letters

I sympathise with Tim Dowling and the challenges of releasing blancmange from a rabbit mould (Jelly’s back! Here are three worth making – and three that should wobble off to the bin, 12 November). My mistake was adding chopped pineapple to the jelly mix, with the resulting jelly looking as though we were seeing the undigested contents of a rabbit’s stomach. My children refused to eat it.Dee ReidTwyford, Berkshire Tim Dowling has missed out one important ingredient from his otherwise commendable recipe for blancmange rabbit: the two sultanas you stick on for the eyes.Jane GregoryEmsworth, Hampshire Regarding concerns over Epstein Road in Thamesmead (Letters, 12 November), spare a thought for those unfortunate residents of Savile Row in central London

5 days ago
businessSee all
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FTSE 100 in biggest drop since April as stock market sell-off continues – as it happened

about 5 hours ago
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ExxonMobil to shut chemicals plant in Fife with loss of up to 450 jobs

about 5 hours ago
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Crest Nicholson plans job cuts and warns on profits, blaming budget uncertainty

about 11 hours ago
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Eight firms under investigation in crackdown on additional online fees

about 12 hours ago
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Lawyers for Fed governor accuse Trump administration of ‘cherry-picking’ facts in fraud case

1 day ago
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Japan and Switzerland’s economies contract as US tariffs hit exports; Alphabet shares jump after Warren Buffett reveals stake – as it happened

1 day ago