Primark and Exel open distribution centre in Pennsylvania, USA
Primark, a leading European fashion retailer now establishing a presence in the north eastern United S...
Primark, a leading European fashion retailer now establishing a presence in the north eastern United States, and Exel, the North American leader in contract logistics and a Deutsche Post DHL Group company, has announced the opening of the distribution centre in Bethlehem, Pennsylvania.
Bethlehem Mayor Robert Donchez led the ribbon-cutting ceremony for the facility, along with key executives including Paul Marchant, CEO of Primark; Jim Gehr, President of Retail and Transportation at Exel; and Dan McNutt, Senior Vice President of Retail at Exel.
Paul Marchant, said: “The entire team at Primark is thrilled to be opening our Bethlehem distribution centre and to contribute to this robust community. This centrally located facility is a cornerstone to our plans in officially launching our business in the north east and this opening marks a key milestone for the Primark brand.”
Located at 2485 Commerce Centre Blvd., the depot occupies 677,080 square feet of leased space within Lehigh Valley Industrial Park VII and will be operated by Exel. The facility will provide approximately 100 jobs to those in the region.
“I am honoured to welcome Primark into the community and to have Bethlehem supporting the thrilling expansion of this noted brand here in the US” said Mayor Donchez. “We look forward to this fruitful partnership as Primark continues to increase its presence in the Northeast.”
Exel will manage the warehouse operations by leveraging Primark’s proven operational and systems model that has been utilized by DHL Supply Chain in the UK and Europe for the past six years. In addition to managing the facility, Exel will be responsible for transporting merchandise to Primark’s stores.
“We are excited to support Primark’s stores in the Northeast and help them grow their fashion brand in another market,” said McNutt. “With Exel managing the distribution centre and transportation services for Primark, the company can focus on their customers.”
The new depot will serve as Primark’s distribution centre for the Northeast, where the company plans to open eight retail stores by the end of 2016. Primark’s first U.S. store launches September 10th in Boston’s iconic Burnham Building, Downtown Crossing, with a second store opening planned in King of Prussia in November. Upcoming Primark locations include Burlington Mall (Burlington, Mass.), Danbury Fair (Danbury, Conn.), Freehold Raceway Mall (Freehold, N.J.), South Shore Plaza (Braintree, Mass.), Staten Island Mall (Staten Island, N.Y.) and Willow Grove Mall (Willow Grove, Pa.).
Primark is one of the largest clothing retailers in Europe, offering customers quality, up-to-the-minute designs at value-for-money prices. It has 290 stores and employs over 62,000 people in the UK, Republic of Ireland, Spain, Portugal, Germany, the Netherlands, Belgium, Austria and France. Primark, which is a subsidiary of Associated British Foods plc, was founded in June 1969 in the Republic of Ireland. In 2006, Primark opened a store in Madrid, Spain, its first in Continental Europe, and now operates from 11 million square feet of selling space across nine countries. There are five distribution centres in Europe– one in the Republic of Ireland, two in the UK, one in Spain, one in Germany.
Primark has been ranked a Leader by the UK’s Ethical Trading Initiative since 2011, and in 2014 Greenpeace’s Detox campaign recognised Primark as a leader on the issue of chemicals management.
Exel is the North American leader in contract logistics, providing customer-focused solutions to a wide range of industries including automotive, consumer, retail, engineering and manufacturing, life sciences and healthcare, technology, energy and chemicals. Exel’s innovative supply chain solutions, skilled people and regional coverage bring together all aspects of contract logistics in addition to a wide range of integrated, value-added and specialist services. Exel is a wholly owned entity of Deutsche Post DHL Group, the world’s leading logistics group. For more information, visit www.exel.com.
For more information, follow @Primark on Twitter.
Driver shortages: Why the industry needs to be worried
While driver shortages are a global problem, with a recent survey from the International Road Transport Union suggesting that driver shortages are expected to increase by 25% year-on-year across its 23 member countries, the issue has very much made itself felt for UK businesses in recent weeks.
A perfect storm of factors, which many within the industry have been wary of, and warning about, for months, have led to a situation wherein businesses are suddenly facing significant difficulties around transporting goods to shelves on time, as well as inflated operating costs for doing so.
What’s more, the public may also see price rises as a result due to demand outmatching supply for certain product lines, which in turn brings with it the risk of customer dissatisfaction and a hit to brand and stakeholder reputation. Given that this price inflation has been speculated to hit in October, when the extended grace period on Brexit customs checks comes to an end, the worst may be yet to come.
"Steps must be taken to make a career in the industry a more attractive proposition for younger drivers, which will require a joint effort from government, industry bodies, and the sector as a whole"
That said, we have already been hearing reports of service interruption due to lack of driver availability, meaning that volumes aren’t being transported, or delivered, to required schedules and lead times. A real-world example of this occurred on the weekend of 4-6 June with convenience retailer Nisa, with deliveries to Nisa outlets across the UK affected by driver shortages to its logistics provider DHL.
But where has this skills shortage stemmed from?
Supply is the primary issue. Specifically, the number of available EU drivers has decreased by up to 15,000 drivers due to Brexit alone, and this has been further exacerbated by drivers returning to their home country during the COVID-19 pandemic, as well as changes to foreign exchange rates making UK a less desirable place to live and work. This, alongside the recent need to manage IR35 tax changes, has also led to significant inflation in driver and transport costs.
COVID-19 complications have also meant that there have been no HGV driver tests over the past year, meaning the expected 6,000-7,000 new drivers over the past year have not appeared. With the return of the hospitality sector we understand that this is a significant challenge with, for instance, order delivery lead times being extended.
It is little surprise, therefore, that the Road Haulage Association (RHA) earlier this month became the latest in a long line of industry spokespeople to write to the government about the driver shortage for trucks. The letter echoed the view held by much of the industry, that the cause of this issue is both multi-faceted and, at least in some aspects, long-standing.
So, many in the industry are in agreement as to the driving factors behind this crisis. But what can be done?
Simply enough, outside of businesses completely reorganising their supply chain network, external support is needed. In the short-term, the government should consider providing the industry with financial aid, and this can also be supported more widely with legislative change.
Specifically, immigration policy could be updated to place drivers on the shortage occupations list, which would go some way towards easing the burden created by foreign drivers returning to their home countries. Looking elsewhere, government should also look for ways to increase the availability of HGV driver tests after the blockage created by the coronavirus lockdowns.
Looking more long-term, steps must be taken to make a career in the industry a more attractive proposition for younger drivers, which will require a joint effort from government, industry bodies, and the sector as a whole. As it stands, multiple sources suggest that the average age of truck drivers in the UK is 48, with only one in every hundred drivers under the age of 25. We must therefore do more to increase the talent pipeline coming into the industry if we are to offset more significant skills shortages further down the line.
On the back of a turbulent year for the supply chain industry, it has become increasingly clear that the long-foretold shortage of drivers is now having a tangible and, in places, crippling effect on supply chains.
Drivers, and the wider supply chain industry, have rightly been recognised for the seismic role they played in keeping the nation moving and fed over the past year under unprecedented strain. If this level of service is to continue, we must now see Government answer calls to provide the support the sector needs, and work hand-in-hand with the industry to find a solution. If we do not see concrete action to this effect soon, we are likely to be in for a turbulent few months.
Rob Wright is executive director at SCALA, a leading provider of management services for the supply chain and logistics sector