Ocado bucked the trend with much better than expected sales over the Christmas period, leading the company’s CEO to say that investors were seeing the light on the grocer. The internet grocery deliver firm said sales increased by 27% in December, significantly better than analysts estimated and would have passed 30% had it not been for the snow.

The firm saw a dramatic increase in trade in the Christmas week with sales of £12.3m, more than 40% higher than the same period in 2009. Sales in December as a whole saw a 26.7% growth with £50.9m of deliveries. Ocado said that it managed to meet 98% of orders during the period with customers in rural areas telling them its van were the “only ones’ on the road.

Only six drivers got into any difficulties compared to more than 20 in the 2009 cold snap. The update came as the company confirmed sales increased 29% to £551.1m in the year to November 28.

Speculation has been rife as to how successful Ocado will be in the long run, with one analyst describing 2011 as the “acid test” for the company as Waitrose looks to introduce its own delivery service in London for the first time.

Jonathan Pritchard, an Oriel analyst said “ It is impossible not to be impressed with what (Ocado) management has achieved here but it gets tougher from here,’ adding “The ‘non-compete’ clause with Waitrose within London is coming to an end and with Morrisons and M&S undoubtedly looking to add a home-delivery offer, things are unlikely to remain plain sailing.”

Please note the views expressed in this blog are the views of the author, Andre Brown and do not represent the view of Locayta, its employees or its shareholders. For more information about Locayta, visit www.locayta.com