• Woolworths will build an automated warehouse in Western Sydney it says will fulfill 50,000 online deliveries a week.
• It comes as the Australian grocery giant reported it saw online sales skyrocket 92% in the last six months of 2020.
• Amazon is also aggressively expanding its Australian footprint, with its fifth fulfilment centres set to open in Sydney by the end of 2020.
• Visit Business Insider Australia’s homepage for more stories.

Woolworths has announced it will build an automated warehouse in Western Sydney which will fulfil up to 50,000 online deliveries a week and compete with Amazon’s expanding footprint in Australia.

Located in Western Sydney, the company said construction will begin in 2021, with a launch projected for 2024.

The announcement comes as the company reported online sales growth of 92% in the last six months of 2020, with online sales accounting for 8% of total sales.

Amanda Bardwell, the managing director of WooliesX, the company’s technology and innovation arm, said in a statement that the move was a response to the rapid acceleration in online grocery shopping during pandemic lockdowns in 2020.

“As we look ahead, we expect more and more customers will turn to the ease and convenience of home delivery to reclaim time in their busy lives,” she said.

“To keep pace with the demand, we need to innovate with new technology to boost capacity and ensure we’re continuing to offer the best possible online grocery experience.”

Bardwell said the fulfilment centre would offer its Western Sydney customers a more streamlined experience, with the company’s personal shoppers able to pick up more orders leading to faster delivery options.

Last year’s pandemic accelerated trends towards online shopping, with global consulting firm McKinsey reporting an increase which had been projected for the next decade occurring over just three months.

While still awaiting approval from the NSW Department of Planning, the planned facility to be located in Auburn in Western Sydney will span 22,000 square metres and support up to 250 full-time roles.

Woolworths said it would build the facility in partnership with international logistics and automation company Knapp which has developed similar projects in the US, Korea and Germany.

Amazon is also gearing up for expansion in Australia, with its fifth robotics fulfilment centre in Australia set to open later this year.

The world’s biggest e-commerce company said its new fulfilment centre, which will also be located in Sydney, will be around 200,000 square metres across four levels and create 1,500 jobs.

Amazon’s use of automation and labour practices have been criticised by labour groups in the US and globally, however Amazon Australia director of operations Craig Fuller told Business Insider Australia at the time that its warehouse would be a job creator for the state.

“We know from our experience of launching Amazon robotics buildings in other countries that we actually make jobs,” he said.

“Since we started launching robotic sites, we’ve created around about 300,000 jobs.”

Follow Business Insider Australia on Facebook, Twitter, LinkedIn, and Instagram.