But Coles Online general manager Karen Donaldson said on Wednesday the supermarket was working on a number of initiatives to make the business more profitable in the short term.

“It's a 20-year-old business and we’ve now got over $1 billion [in annual revenue] so we’ve got scale which makes a difference to everything when you’re trying to improve profitability,” she said.

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“If you think about the whole chain from when someone places an order with Coles Online through to when it’s delivered, there’s multiple opportunities for us to actually make the business more profitable.”

That includes changes to the delivery pricing structure that will be introduced over the next four weeks. Previously, customers who spent $150 or more could get free delivery if they opted for an eight-hour delivery window.

That has been shortened to six hours, and customers who spend over $300 can now get free delivery in a two-hour window. Coles thinks that premium service will be cheaper for it to provide because it will encourage shoppers to buy their groceries in larger batches, requiring fewer delivery runs.

"It’s really a matter of us using all the data and saying, knowing what we know about our customers, what’s a segment of customers who might like something different or even more premium than what we do today?," Ms Donaldson said.

Coles is also using technology to improve the efficiency of its online supply chain, by equipping store staff with handheld devices that direct them around stores when packing orders.

It is also improving its route planning software for its fleet of delivery vans to optimise their efficiency and enable more delivery windows for customers.

While Coles is trying to push home delivery into profitability as a premium product, Ms Donaldson said the supermarket would not "outprice the market" and had to remain competitive.