2,000 jobs axed in Shop Direct automation plans
Written by Chris Lemmon
Shop Direct has announced proposals to replace its three Greater Manchester fulfilment centres with a new fully-automated, 500,000 square foot distribution and returns centre in the East Midlands.
As part of an 18 month project, Shop Direct reviewed its fulfilment sites at Shaw, Little Hulton and Raven, concluding that limited accessibility, layout and loading restrictions, coupled with a lack of space, meant that these centres “do not meet the group’s future operational ambitions”.
The online retail group, which owns brands including Very and Littlewoods, said it needed a new, purpose-built automated facility in a central location in order to meet growing customer demand. The new centre needed to be able to accommodate all one-man fulfilment and returns operations on one site, and provide room for continued expansion.
The proposed new site will mean that Shop Direct can process more orders and use new technology to make the business more responsive, reducing the time it takes to get products to customers.
Development of the site at East Midlands Gateway is due to start in May 2018, and the group plans to begin exiting its existing fulfilment sites in Greater Manchester from mid-2020. The new site is expected to be fully operational by peak 2021.
The move is expected to impact 1,177 permanent Shop Direct colleagues and 815 agency colleagues. Redundancies are anticipated as a result of the site closures.
“This is a tough day for the business and we know how difficult this news will be to hear for our teams in Shaw, Little Hulton and Raven. However, these proposals are necessary for our future and to enable us to continue to grow and meet rising customer expectations,” said Derek Harding, interim group chief executive of Shop Direct.
In response to the announcement, Mike Aylward, divisional officer at the Usdaw trade union, said he did not regard this as a done deal. “We are meeting tomorrow with the local MPs and Oldham Council to see what we can do together to make the company have a rethink. We will then enter into consultation meetings to interrogate the details of the business case for the closures and challenge the plans for relocation.”