John Lewis Partnership is one of the leading UK retailers with 28 department stores, 234 Waitrose supermarkets, and other businesses (Mangan & Lalwani, 2016). The company’s stores stock over 350,000 goods lines. The retailer’s growth led to the development and introduction of the so-called SANDC (Semi-Automated National Distribution Center) in 2009. The center includes 46 despatch and 33 receiving docks. The SANDC can handle item-level picking, which enables the company to meet the growing needs of its customers. The center also has a specific area for direct delivery to the customer. The goods are delivered to the customer’s home or to a retail store chosen by the customer.
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The direct delivery operations need to be expanded through the increase in the area devoted to such services and software improvements.
One of the possible solutions is the increase of the area within the center in Milton Keynes. It is possible to construct additional facilities as it is impossible to reduce other areas of the center to accommodate a larger zone for direct delivery. Another option is the development of one more center in Hougton or Carlisle. In this way, the retailer will be able to deliver goods faster and more efficiently to Scotland, Northern Ireland, as well as northern parts of England. Another option may be the construction of a network of small Semi-Automated National Distribution Centers across the country. It is also possible to make three shifts (instead of two shifts) a norm for the direct delivery area of the SANDC.
Choice and Rationale
The most appropriate option for the retailer is the construction of a new facility in Hougton or Carlisle. The company is constantly growing and expanding its operations and its network. The establishment of new stores and facilities in Wales and other areas of the UK boosted sales in these regions (Skapinker & Felsted, 2015). As has been mentioned above, the increasing interest in e-commerce will inevitably lead to an increase in direct delivery services. The company will be able to deliver products faster and meet the growing demand for one- or two-day delivery offered by such giants as Amazon or other online retailers (Mangan & Lalwani, 2016).
The option involving the construction of additional facilities within the existing center is less effective as compared to this option. The use of another location is beneficial due to the ability to reach more customers. The solution implying the construction of small centers is not very cost-effective. The construction and maintenance costs are quite significant, and it can be difficult to choose the most optimal locations due to the demographics changing rather rapidly. The strategy involving the introduction of three shifts is not effective as it will not meet the growing demand in the long run. Besides, it will require additional funds to pay to the staff, but there will be no need for the construction of a new facility, which may be rather expensive.
To implement the strategy chosen, it is important to undertake certain steps. The stage of planning will involve such areas as the choice of location, design, and construction, hiring and training personnel, development of the software as well as the improvement of the existing information system. After the planning process, the implementation and evaluation will take place. The stages involving information management and HRM should be properly planned and implemented. As to HRM, it can be beneficial to recruit the existing employees (working at the existing SANDC) to work in the new facility. These employees have the necessary skills and knowledge, and they will share their experiences (Christopher, 2016). The upgraded software should include more services for customers. Items tracking should be one of these services as modern shoppers are accustomed to being in complete control of their orders.
Christopher, M. (2016). Logistics & supply chain management. New York, NY: Pearson.
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Mangan, J., & Lalwani, C. (2016). Global logistics and supply chain management. Chichester, UK: John Wiley & Sons.
Skapinker, M., & Felsted, A. (2015). John Lewis: Trouble in store. Financial Times. Web.
- To address the changing demand patterns, it is necessary to increase the number of picking stations and automated lines. The development of e-commerce is likely to result in the increase in the associated operations provided by John Lewis Partnerships. The use of the upgraded SANDC can make the operations more efficient. At that, the software should be improved in the area of items’ tracking.
- The use of the area dedicated exclusively to home shopping is beneficial as it enables to achieve maximum cost-efficiency. The storage areas will be used efficiently, and more orders can be processed. To address the increasing attention to online shopping, the retailer can make the area even larger and the development of more picking stations. It is also possible to consider developing a new facility in another location.
- One of the major areas to pay attention to when it comes to the improvements of SANDC is the development of new services. People have become accustomed to their ability to track their products when shopping online. Therefore, the introduction of this service will attract more customer and make them more loyal. The introduction of picking points devoted to particular orders or items will enhance efficiency.