Tesco and Safeway in US e-alliance

Profitable business is a dotcom rarity

Britain's biggest supermarket chain and the world's biggest e-grocer, Tesco, is exporting its online know-how to the US as part of a £15.7 million ($22 million) investment in home shopping.

Tesco PLC has taken a 35 per cent stake in GroceryWorks - Safeway's on-line grocery e-tailer - as part of the deal.

The food retailer will also help develop GroceryWorks' existing Web sites and help overhaul business and operational.

Key to this is scrapping GroceryWorks' method of fulfilling orders from stock at warehouses, and instead adopting a store-based grocery home shopping service using Safeway's 1500 US outlets.

Tesco.com has one million registered users and fulfils 70,000 orders a week.

In the UK, its e-operation is profitable with annualised sales currently running at £300m ($420m). ®

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