* First deliveries of M&S food made by Ocado Retail
* Says launch has been "incredibly popular"
* Surge in demand has impacted "very small number of orders"
* M&S shares down 4.4%
(Adds Waitrose comment, shares)
LONDON, Sept 1 (Reuters) - Britain's Marks & Spencer
made the first deliveries through its new online food shopping
joint venture with Ocado on Tuesday, though the launch
was marred for a "very small number" of customers whose orders
were cancelled.
The 1.5 billion pound ($2 billion) Ocado Retail venture is a
cornerstone of M&S's latest attempt to turn itself around and
offset problems at its pandemic-hit clothing business.
"The M&S launch has been incredibly popular. We have seen a
surge in demand for M&S products in the run up to launch which
has impacted a very small number of orders today," said an Ocado
spokeswoman.
"The vast majority of customers are unaffected and will be
delivered as normal. We would like to thank our customers for
giving M&S such a big welcome and sincere apologies to any
customers having to wait a bit longer."
After a decade of failed revamps and amid plunging sales in
clothing and homewares, M&S could have done with a flawless
launch.
Shares in M&S were down 4.4% at 1207 GMT, extending 2020
losses to 50%. Ocado shares, which have nearly doubled this
year, were up 0.6%.
The venture ends Ocado's two-decade supply contract with
supermarket chain Waitrose, part of the employee-owned John
Lewis Partnership, and replaces some 4,500 Waitrose
products with the full M&S food range of 6,000 products and 800
everyday clothing and home lines.
Online grocery shopping has doubled its share of the UK
market to 14% since the start of the COVID-19 pandemic, and
Ocado reckons it could reach 30% over the next few years.
Waitrose sees the split with Ocado as an opportunity to
further develop its own online services.
"You can count this as our graduation day, we're ready to go
on our own," Waitrose Executive Director James Bailey told Sky
News.
"We've got 160,000 order slots ready for our customers,
they're full every week and we're growing week on week, so we're
pretty confident about the future," he said.
On Friday Waitrose said it was teaming up with Deliveroo to
trial fast home-delivery.
($1 = 0.7440 pounds)
(Reporting by James Davey; Editing by Alistair Smout, Kate
Holton and Susan Fenton)