Will Vaughan’s e-commerce grocery facility -- the first in North America -- spur technology adoption?

‘The technology is mind blowing,’ says Michael Medline, president and CEO of Empire and subsidiary Sobeys Inc.

Yorkregion.com
Sept. 28, 2020
Dina Al-Shibeeb

Two years ago, Michael Medline, President and CEO of Empire Co., was sitting in his backyard and then -- boom -- came the mega lightbulb vision when he was reading about Ocado.

Ocado isn’t Canadian. Rather, it’s a U.K.-based company that touts itself as a “serial innovator,” “disrupter” and the “world's most advanced end-to-end e-commerce, fulfilment and logistics platform.”

Ocado comes with an army of robots, which are efficient at packaging fresh produce like tomatoes.

Its mission, after all, is to “solve the many complex problems” in the grocery world.

“The technology is mind blowing,” said Medline, who after reading about Ocado decided to hop on a plane to see it for himself.

“The first time I saw it, you couldn’t take me away from it,” said Medline, appointed in early 2017 as Empire's President and CEO and its wholly-owned subsidiary Sobeys Inc.

“It’s a huge hive of 250,000 totes carrying 39,000 of different products, which is the most in the world. On top of our huge hive are our robots running around picking around and optimizing.”

“We knew we had to have it,” he said. “It’s the only thing in my career, I always said ‘you don’t need anything even though there are things that are nice to have’.”

On Sep. 18, Sobeys marked the official launch of its new distribution centre, a facility of 250,000 square feet or about the size of 15 hockey rinks. The launch comes after Empire said in July it plans to spend $2.1 billion over the next three years on revamping stores and expanding its e-commerce offering.

So far, profits aren't in sight, however once Sobeys starts scaling up “over the next year,” it’s expected to be pouring, said Medline, who described the operation as a “startup.”

The event attracted Premier Doug Ford, who dubbed the facility the first in Canada and North America.

“Absolutely amazing,” said the jubilant Ford, describing how the expected 1,500 new jobs would help people “pay their mortgage” amid COVID-19 pandemic.

The official launch also saw Vaughan-Woodbridge MPP Michael Tibollo, MP Francesco Sorbara for Vaughan -- Woodbridge and Councillor Tony Carella attending.

Medline’s motivation in bringing about this technology is also his ardent aspiration to accelerate Canada’s adoption of the ever unfolding advancement in the tech sector.

It has been widely reported that Canada lags behind peers when it comes to technology adoption.

A report published in June by the national Canadian tech industry association -- TECHNATION -- described how too few Canadian companies, educators, policymakers, and future leaders understand AI’s capabilities and limitations.

“Canada lags the rest of the world in grocery e-commerce, but we are a very modern country; we are technologically savvy,” Medline lamented. “Canada deserves the best technology and the best customer service.”

His vision meant that Voila by Sobeys was the first receiver of Ocado’s technology.

“There are now partners around the world but we were the first to build it other than Ocado in the U.K.,” Madeline said. “There is one operating in France,” he added.

“We are the first in North America, and there are going to be dozens if not hundreds built by Kroger in the United States.”

Sarah Joyce, senior vice president of e-commerce, Sobeys, recalled how the vision was to bring this technology to the GTA, where “we only have the technology partnership” with Ocado, and “a shell of a building right behind me.”

Now, not only does the facility have three temperature zones, from ambient, chilled to frozen, but it’s solving one of online shopping’s biggest hurdles and that’s getting the order right.

“I actually got what I ordered, which is no less than miracle these days,” Joyce recounted a quote from a customer. “That’s one of the main complaints for people who tried online grocery.”

Currently, the service is available from Hamilton in the west to Oshawa in the east, and to Newmarket in the north. Sobeys charges delivery fee of $7.99 for a minimum order of $50.