Ocado to sign first deal for its Ocado Smart Platform technology as it recruits 150 developers

Next phase in Ocado's expansion plan will see the company sell its core technology platform overseas

Online supermarket Ocado is aiming to seal its first deal for its Ocado Smart Platform technology this year - with the company revealing that it is already talking to several potential partners - and is also planning to hire 150 new developers to support its technology plans.

The Ocado Smart Platform is home-grown technology that the company uses to run its customer fulfillment centres and to schedule its deliveries. Chief technology officer Paul Clarke revealed to Computing last year that the company was planning to package and commercialise the software, primarily for overseas markets.

Although its deal with supermarket Morrisons has proved a success in financial terms, Clarke added that it would be the only such deal in the UK. Users of the Ocado Smart Platform, therefore, are likely to be companies based in the US or Europe.

Unveiling its results this week, Ocado CEO Tim Steiner said: "The successful launch and smooth ramp up of Morrisons.com was particularly encouraging and paves the way for future agreements to commercialise the value of our intellectual property."

The platforming and packaging of the company's bespoke retail and warehousing software would be the key vehicle for doing this, he continued: "The development of Ocado Smart Platform, enabled by our IT re-platforming and fulfilment solutions projects, positions us well to take advantage of future opportunities as the demand for online grocery shopping increases internationally.

"Overall, we are well equipped to continue to lead the online grocery revolution, in the UK and overseas, as increasing numbers of customers shift away from traditional forms of retailing."

Elsewhere in the CEO's review, he added: "Our capabilities are being significantly enhanced and broadened with the ongoing development of our new modular, scalable physical fulfilment solution. This system has benefited from our extensive design and engineering experience, which has enabled us to develop a proprietary solution with many beneficial attributes when compared to existing infrastructure assets or any commercially available alternatives.

"Successful development of this infrastructure solution will vertically integrate our platform of software, electronic and mechanical systems required to operate online retail operations efficiently, enabling a compelling proposition to the consumer and our partners. Our solution combines extremely dense storage, rapid retrieval and fast picking of single items. We believe it is the most capital-efficient solution available," he said.

He continued: "The new product storage and retrieval system incorporates a number of technological advances, including a highly sophisticated proprietary communications technology capable of interacting inside a building with thousands of devices multiple times per second, significantly in excess of any technology currently available commercially.

"The constituent elements of this infrastructure solution are currently undergoing significant testing and we are confident in their key performance capabilities. We have filed for patents across our innovations, driven by the desire to protect the IP intrinsic to our infrastructure solution. As more patents are filed we are building a web of protection for our valuable IP in the future."

To further the company's technology developments, Ocado is planning to expand its team of developers from around 550 to 700 this year, although not all of those will be in the UK: the company also employs an expanding team of developers in Poland, primarily due to the quality of staff in terms of mathematics and computing skills available in Eastern Europe.

Some of these developers will be deployed porting Ocado's platform to the cloud, so that the company can offer its platform as a service. Ocado is also working on robotics and "vision systems" so that it can run its warehouses more efficiently.

The news from Ocado was made as the company presented its preliminary financial results for the year to the end of November 2014. Thanks partly to the Morrisons deal, gross sales increased by 15 per cent to £972.4m, while the company (finally) posted a pre-tax profit, its first, of £7.2m. Net debt, however, doubled to £99.4m, while cash and cash equivalents fells by around one-quarter from £110.5m to £76.3m.