At worst, half of Oda’s customers encountered a closed online store. Now the grocery challenger claims to be “above the fold”.
CAUSED TROUBLE: Oslo experienced periods of extreme weather this winter, especially in January. It went beyond Oda’s capacity. Photo: Ørn E. Borgen / NTBPublished: Published:
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Oda Norway increased revenues by 15 per cent from NOK 2.7 to 3.1 billion last year. Norwegian manager Kristin Thornes Woldsdal says so.
– It is a relatively strong growth that we are satisfied with, she says.
At the same time, there was another loss for the online player. The annual result came in at minus NOK 200 million. Since its inception in 2014, the company has now lost NOK 1.4 billion in Norway.
Phases of hyper-growth, building new warehouses and rebranding to become a low-cost player have contributed to the deficit in recent years. Last year, Oda made a completely different mistake.
– We had major capacity limitations throughout the year, says Woldsdal.
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– Would have had 20 percent growth
It happened because Oda decided to have most of the drivers employed by its own company, in order to ensure orderly working conditions and better control over capacity.
– In the last year and a half, we have gone from less than 30 per cent of the volume being taken by our own drivers to the share now being over 80 per cent, says Woldsdal.
Kristin Thornes Woldsdal is responsible for the operation of the country’s largest player for online food. Photo: Siv Dolmen
But the phasing out of third-party actors went faster than planned. Oda was unable to recruit new drivers at the same pace.
– So we have had periods of driver shortages that have exceeded capacity. Far too many customers have encountered a closed shop and “turned around at the door”.
In periods, up to 50 per cent of customers who have entered the online store have been told that next-day delivery is not available.
– It is a great pity. We estimate that without the capacity restrictions, we would have had well over 20 percent growth. But I still think it was the right choice to make.
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The question of profitability
Since the summer, Oda has employed 350 drivers. Woldsdal says that they are on target now.
– We have overcome the problem and are now at the point where we can capture the full demand again.
In recent weeks, the volume has reached new heights, she says. Easter week this year saw 20 per cent growth compared to last year’s Easter week.
What does that mean for the chances of Oda’s first positive result coming this year?
Woldsdal says that operations turned a profit in the second half of last year.
– It’s great fun that we’ve gotten there with our low-price position.
Oda continues to go into the red. The Norwegian boss believes that 2024 “looks very promising” in terms of profitability. Photo: Siv Dolmen
Although it is not so easy to find in the accounts, the Oda boss said that they had a positive operating result in Norway in 2021 as well. Since then, the company has changed its profile to compete in the same segment as Kiwi, Extra and Rema 1000.
The key to achieving this profitably is efficient operation and high volume. Woldsdal says that Oda constantly set new efficiency records throughout the autumn, so that they became profitable at the new “price point”.
– Has profitability continued into 2024?
– We are growing well and still have the same efficiency improvements that we saw last autumn.
– Was it a yes or no?
– I will not comment on profitability for individual months. It is also closely related to price. But this year looks very promising in terms of profitability.
Will miss Karl
Just under a month ago, Oda announced that Karl Munthe-Kaas, founder and CEO since the start, had finished in the management chair.
He was asked to step aside, partly as a result of an expensive fiasco abroad.
– How is it not to have him on the premises anymore?
– I think Karl is a fantastic leader and will miss working with him. We are very happy that he is continuing on the board, says Woldsdal.
The new boss is called Chris Poad. He has experience as CEO of Tesco’s online store, as well as management positions at Amazon.
– He has both relevant and exciting experience, which can be very valuable for Oda. So I am excited to see how he can use that experience to further strengthen our position.
Poad already took office a couple of weeks ago, but has not made it to Norway yet. Work visas after Brexit are a time-consuming affair, says the communications manager.
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