Grocery delivery firm Ocado has signed its first international agreement, which will see a regional European retailer use its Ocado Smart Platform (OSP).

The retailer, which currently remains unnamed, will benefit from a full software platform and the expertise and support services required to create an online grocery business, with orders initially fulfilled from Ocado’s manually operated centralised warehouse.

As part of the agreement, the new partner has the right to request the installation of automated mechanical handling equipment in centralised warehouses, powered by OSP technology.

The partner will pay an up-front fee to Ocado for access to OSP, together with ongoing fees that are based on the volume of products sold online. Ocado expects the arrangement to be earnings and cash neutral in the current and 2018 financial years, and increasingly accretive thereafter.

Tim Steiner, CEO of Ocado, commented: “We are delighted that our partner has decided to adopt OSP for its online operations. This is an exciting step in the evolution of our business and in the delivery of our strategy.

“The benefits of our integrated solution are clear. As this particular retailer looks to develop its online offering the agreement we have signed provides the flexibility to expand its capacity efficiently in the future. We look forward to working closely with our new partner in the months and years ahead.”

Ocado commercialised its OSP platform in 2013 with its agreement to operate the online business of Morrisons supermarkets in the UK, which was expanded last year. Ocado also has a partnership with Waitrose to sell the supermarket’s goods on its website, but Waitrose conducts its own deliverie

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