How Staples is striving to become a logistics titan
When consumers think of Staples, they might recall the company’s famous office essentials. From its ink and toner to its office furniture, the firm is renowned as a world-class, multi-channel retailer. However, after selling off its retail business in the UK, Staples is pivoting towards a new market: the world of third-party logistics (3PL).
Kevin Lewis, Supply Chain Director at Staples UK, has helped to steer the firm’s supply chain transformation, consolidating its six warehouses across the UK and Ireland into one cutting-edge facility. “We’ve moved into a state-of-the-art distribution centre in Corby, Northamptonshire. In retrospect, it was much larger than we needed and it pushed us to look at how we could better utilise this asset. Now, we have some large-scale brands that have closed their own warehouses and made use of ours as a shared-user facility.” Winning business from traditional 3PL providers, Lewis contends that around 60% of the activity on the site now revolves around 3PL. “Our expertise has been focused on consolidated deliveries, consolidated invoices and the ability to mix our core product with actually almost any other product,” he adds.
The distribution facility is an impressive feat but perhaps the most exciting aspect of the facility is its ingenious use of technology and automation. “About 70% of our operations are automated so we use Pick to Belt and Pick to Light solutions. On top of this, we also have implemented an order, storage and retrieval (OSR) system by Kanpp” explains Lewis. “It was a £9mn investment just for the picking tower alone, but by using the full height of the building we can be much more efficient.” It also allows people to pick economically; adjustable platforms mean that people don’t have to reach or bend down to pick up items. Instead, they can pick from a height that’s comfortable for them. On top of this, Staples has also experimented with weighing technology that adds an additional layer of protection. “It’s an extra safety net,” observes Lewis. “We know the weight and dimensions of every single product so if there is any weight deviation, we would be able to see that and alert the team.”
With this state-of-the-art facility, Staples is well equipped to tackle any logistical challenge. It’s also worth noting that in recent years the company has closed many of its brick-and-mortar stores and pivoted towards ecommerce. This means it has first-hand experience of the challenges of efulfilment. Furthermore, having already made significant capital investments in automation, Lewis contends that Staples can offer its clients more competitive contracts. “When you go to a traditional third-party provider, they’re not going to make an investment in technology and automation unless they can recoup that investment within the lifetime of the contract,” he explains. “The difference with Staples is that we have already made that investment. We want to make shared use of our assets and we can also offer competitive contracts.”
Indeed, Staples has already won over big-name clients like Adidas, and car servicing and repair company Kwik Fit. “If a Kwik Fit branch needs some brake cleaner or if an Adidas store wants to order some carrier bags, they can only get it from this warehouse,” Lewis notes. “Elsewhere, our biggest third-party client is Saint-Gobain, which owns businesses such as glass companies and Graham heating and plumbing. For this customer alone we have over 9,500 bespoke SKUs.”
Staples may be known for its retail business but the firm is quickly making waves in the logistics sphere. This is partly thanks to its tech-savvy operations and global experience, but also its successful strategic partnerships. “We work with last-mile partners including TNT Fed Ex Group and Pallex. Both partnerships offer bespoke, tailored solutions exclusively for Staples,” says Lewis. This strong sense of collaboration can also be seen within the company too. By paying competitive, living wages rather than a minimum wage and investing in its team, Staples has worked hard to build a dynamic logistics business. “In the past, we relied on agency workers and temporary labourers, whereas now it’s predominantly a permanently employed workforce,” says Lewis. “There are fewer absences, more efficiency and a lower turnover of people because we’re investing in our team.”
With this strategy in mind, Staples is ready to continue on its upward trajectory, running more and more supply chains on behalf of customers. “Staples may have sold its retail business in the UK, but we’re very much thriving in terms of e-commerce and third-party logistics,” affirms Lewis.