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John Lewis: Distribution centres key to omni-channel success


With growing online sales, retailers must push the speed of delivery to keep up with consumer demands. John Lewis is preparing by creating a new distribution centre in Milton Keynes, dedicated solely to large furniture, electricals and home furnishings.

The chosen area comes as no surprise, following news that the homewares sector dominated high street sales in January- providing an 8.4% increase. This boosted 2015’s ‘damp January’ that failed to maintain the 10.3% success of its first week.

The new centre will be based in a 638,000 sq ft warehouse, joining John Lewis’ distribution centres in Magna Park. This will provide the company with a more organised delivery service-vital for changing consumer shopping habits:

“As customers shopping habits evolve so too does our operational business model. The new DC will enable us to better respond, react and fulfil omnichannel shopping experiences be it via phone, tablet, desktop or visiting a shop”. (Dinos Rocos, Operations Director, John Lewis)

John Lewis is not alone in recognising the need to keep up with time poor consumers, who require reliable distribution services. Competitor Marks and Spencer’s has seen sales falling 5.8% in general merchandise, as Chief Executive of Marks and Spencer’s, Marc Bolland, puts this down to setbacks with its distribution centre in Leicestershire over Christmas. Customers were left worrying whether their gifts would arrive on time.

Grocery retailer Ocado has also been focusing on its centres, with plans to open a fourth in the UK after its first year of profit. The centre is set to stand at 560,000 sq ft and hopes to create around 1000 jobs.

John Lewis has taken a 25 year lease out on the Milton Keyne’s building, with plans to open the centre in 2016. The move is fitting, as more people are turning online for choice, service and timing. A thriving distribution centre is fundamental to ensure a successful omni-channel business.

Published on Friday 13 February by Rachel Gee

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