Dive Brief:
- CarParts.com is moving its Nevada warehouse operations to a larger location, nearly doubling its footprint in the Las Vegas metro area, COO Michael Huffaker said on a Q3 earnings call last week.
- "This building will serve as our West Coast flagship and will carry between 80% to 90% of our assortment," Huffaker said. He added that the facility will include state-of-the-art picking technology and be able to handle both conveyable and non-conveyable items efficiently.
- The facility is slated to begin operations in Q2 of 2024. The e-commerce automotive parts and accessories provider announced the opening of its original 125,000-square-foot Las Vegas distribution center in 2019.
Dive Insight:
The new Nevada warehouse is one of several ways executives said CarParts.com is pushing to increase supply chain efficiency while reducing costs.
The company recently closed its return center in Peru and has "decentralized returns across the network," said Huffaker, a former Amazon executive. CarParts.com also installed its network's first Cubiscan machine, which will provide more accurate dimension measurements on products.
"Combining this with a recently completed audit to optimize our box assortment, we will reduce the amount of air shipping in each package," Huffaker said. "These implementations long term will further give us greater control of our last-mile costs."
Trimming last-mile expenses will be important in CarParts.com's quest to improve its financial performance. The company's gross profit fell 2% year-over-year due in part to higher outbound transportation costs, but a reduction in fulfillment expenses helped soften the blow.
Despite the higher costs, delivery performance has been strong for the e-commerce company. CarParts.com customers are receiving parts faster than at any point in its history after it focused on improving click-to-delivery speeds, CEO David Meniane said on the call.
Meniane didn't specify what CarParts.com's current delivery speeds are, but it has been expanding its distribution center network in pursuit of reaching up to 90% of its customers within one day. This includes the launch of a distribution center in Jacksonville, Florida, last year.
