Australia's largest department store, Myer (ASX:MYR)
, has secured a 10-year lease on a new 40,000 square metre facility in Victoria. The facility will be Myer's National Distribution Centre (NDC) for both stores and online fulfilment.
The NDC represents the next phase of the supply chain "Factory to Customer" initiative underpinning the Myer customer first strategy, following the enhancements to online operations that were undertaken last year and changes to international freight arrangements earlier this year.
The new build, located at Dexus’s ‘Horizon 3023’ industrial estate in Ravenhall, Victoria, will be a state-of-the art facility holding over 100,000 stock keeping units. There are anticipated to be customer benefits and efficiencies for both physical stores and online businesses, through the implementation of automation solutions.
The new NDC is expected to ensure stock is prioritised for stores with the highest sell through. For the online business, it is anticipated that up to 70 per cent of fulfilment will be performed by the NDC, leading to improved levels of service for our customers, operational efficiencies and reduced cost per order.
Myer stores will still be key for click and collect options, and Myer will offer brand partners access to the NDC facility, allowing them to also take advantage of the efficiencies and services. Construction of the site is underway, and Myer is expected to begin using the NDC in a phased approach from August 2022.
Myer CEO John King, said, “Having a centralised fulfilment centre for stores replaces our historical push model, and will result in improved inventory management, reduced markdowns and maximised sell-through whilst also producing significant efficiencies in our online fulfilment operations.”
Shares in Myer (ASX:MYR)
are trading flat at $0.46.