Skip to content
Search AI Powered

Latest Stories

newsworthy

Home Depot launches pilot for ambitious outbound delivery plan

Four-year, $1.2 billion initiative aimed at making next-day deliveries to all U.S. customers.

Home Depot launches pilot for ambitious outbound delivery plan

The Home Depot Inc. has launched a four-year, $1.2 billion initiative to streamline its outbound delivery operations in an effort to shave one day off its nationwide delivery times, the home improvement giant's top supply chain executive said today.

The program, currently in the pilot phase, is aimed at providing next-day delivery by 2022 to every U.S. customer, and same-day deliveries to a large percentage of the population, Mark Q. Holifield, Home Depot's executive vice president, supply chain and product development, told an industry conference in Atlanta today. Virtually all of Home Depot's outbound deliveries are made via two-day parcel services, but Holifield said that in a world where customers demand delivery speed and flexibility, "we need to be one-day (deliveries) to every customer."


The new network will consist of an array of consolidation centers, local direct fulfillment centers in major markets, specialized parcel fulfillment centers, and what Holifield described as "market delivery" centers that will be installed in an undisclosed number of second-tier markets.

Under the plan, Home Depot will build local direct fulfillment centers in 25 locations, with each location capable of holding 35,000 stock keeping units, or SKUs, Holifield said. It will build "parcel plus" direct fulfillment centers in seven locations, and direct fulfillment centers for flatbed truck deliveries in its 40 largest markets to support deliveries of high-volume, lower-value products to projects and job sites, he added.

The company will also utilize direct deliveries, and it will roll out van and passenger-car services to support local deliveries of small parcels, according to Holifield.

The direct fulfillment center and market delivery operations are underway, said Holifield, who called 2018 the "year of the pilot." The company, which currently employs 15,000 in its logistics and supply chain operations, is in hiring mode for the initiative, he added.

The plan, which has been rumored for months, is a major step in Home Depot's ongoing expansion of its outbound delivery program. The company already operates five massive direct fulfillment centers serving nationwide end markets, and is pushing the so called BOPIS initiative, which stands for "buy online, pick up in store." Home Depot's stores will play key roles in the new initiatives as delivery nodes, Holifield said today.

One challenge may be ensuring that store inventory is well stocked across the network to support online ordering. Home Depot has about 1 million SKUs online, while the typical store supports about 30,000 SKUs, Holifield said.

By the time it is completed, the outbound program could mirror in scope and significance Home Depot's program of nearly a decade ago to centralize product ordering and inventory management functions from vendors to distribution centers. The inbound program continues to be fine-tuned eight years or so since its launch, but it has been successful in streamlining what had once been a disorderly process, Holifield said.

Prior to the revamp, inventory ordering and management were handled at the store level. Holifield estimated that, at one time, 37,000 company employees were responsible for those functions.

The conference was put on by Eye for Transport, a British consulting firm.

The Latest

Artificial Intelligence

AI: Is it the real deal?

More Stories

Logistics economy picked up speed in January

Logistics Managers' Index

Logistics economy picked up speed in January

Economic activity in the logistics industry expanded in January, growing at its fastest clip in more than two years, according to the latest Logistics Managers’ Index (LMI) report, released this week.

The LMI jumped nearly five points from December to a reading of 62, reflecting continued steady growth in the U.S. economy along with faster-than-expected inventory growth across the sector as retailers, wholesalers, and manufacturers attempted to manage the uncertainty of tariffs and a changing regulatory environment. The January reading represented the fastest rate of expansion since June 2022, the LMI researchers said.

Keep ReadingShow less

Featured

Disrupting the furniture supply chain: An interview with Jay Rogers

Disrupting the furniture supply chain: An interview with Jay Rogers

As commodities go, furniture presents its share of manufacturing and distribution challenges. For one thing, it's bulky. Second, its main components—wood and cloth—are easily damaged in transit. Third, much of it is manufactured overseas, making for some very long supply chains with all the associated risks. And finally, completed pieces can sit on the showroom floor for weeks or months, tying up inventory dollars and valuable retail space.

In other words, the furniture market is ripe for disruption. And John "Jay" Rogers wants to be the catalyst. In 2022, he cofounded a company that takes a whole new approach to furniture manufacturing—one that leverages the power of 3D printing and robotics. Rogers serves as CEO of that company, Haddy, which essentially aims to transform how furniture—and all elements of the "built environment"—are designed, manufactured, distributed, and, ultimately, recycled.

Keep ReadingShow less
chart of GenAI effect on workforce

Gartner: GenAI tools create anxiety among employees

Generative AI (GenAI) is being deployed by 72% of supply chain organizations, but most are experiencing just middling results for productivity and ROI, according to a survey by Gartner, Inc.

That’s because productivity gains from the use of GenAI for individual, desk-based workers are not translating to greater team-level productivity. Additionally, the deployment of GenAI tools is increasing anxiety among many employees, providing a dampening effect on their productivity, Gartner found.

Keep ReadingShow less
warehouse worker driving forklift between racks

German 3PL Arvato acquires two U.S. logistics firms

The German third party logistics provider (3PL) Arvato this week acquired the U.S.-headquartered companies Carbel LLC and United Customs Services, saying the move would grow its client base, particularly in the fashion, beauty, and lifestyle segments.

According to Arvato, it made the move in order to better serve the U.S. e-commerce sector, which has experienced high growth rates in recent years and is expected to grow year-on-year by 5% within the next five years.

Keep ReadingShow less
photo collage of warehouse tech

Supply chain pros are wary of inflation and labor woes

The top worries that supply chain leaders hope to address with new innovations this year include inflationary concerns (68%) and labor shortages (50%), according to a survey on innovation from the third-party logistics provider (3PL) Kenco.

And many of them will have a budget to do it, since 51% of supply chain professionals with existing innovation budgets saw an increase earmarked for 2025, suggesting an even greater emphasis on investing in new technologies to meet rising demand, Kenco said in its “2025 Supply Chain Innovation” survey.

Keep ReadingShow less