Dive Brief:
- Maersk opened a fulfillment center to service Levi Strauss & Co. as the retailer continues its distribution and logistics network transformation to increase its omnichannel capabilities, according to an Oct. 9 press release.
- The 1.2-million-square-foot omnichannel fulfillment center in Groveport, Ohio, will serve the retailer’s wholesale, retail and e-commerce channels. Services include end-to-end solutions from origin consolidation to omnichannel fulfillment.
- While operations at the Ohio facility began in August, the center is expected to help improve on-time performance, reduce container handling time and enhance speed and efficiency. It also allows Levi’s to focus on direct-to-consumer-first business (DTC-first), according to the release.
Dive Insight:
As Levi's leans more on third-party logistics services, it's tapping into warehouse technology used by supply chain giants like Maersk.
The Groveport facility will use two sortation systems called EuroSort. The EuroSort system has 40 induction and 600 order locations to match products to orders, a Maersk spokesperson told Supply Chain Dive in an email.
“It’s a proven solution for sorting apparel, operating at high speeds, and can process up to 28,000 products per hour and handle up to 100 million units per year. The EuroSort systems can also handle leftover cartons automatically. This setup reduces the number of trips pickers need to make by allowing batch picking, where team members can collect multiple orders in a single trip,” the spokesperson said.
The first EuroSort is 70% installed while the second one is set to arrive in November, and the whole system will go live in early 2025, the spokesperson added.
The warehouse also features Maersk’s Warehouse Management System, an inventory management tool for real-time visibility. The retailer will be able to adjust production as needed and the location can serve as a training center to improve operations, the spokesperson added.
Levi’s decision to tap Maersk comes after the retailer announced plans to move away from a primarily owned-and-operated distribution logistics network in the U.S. and Europe to save on fulfillment costs, according to a Q2 earnings call.
This facility also makes the 10th global facility operated by Maersk for Levi’s, according to the release. Other facilities are mostly located in Asia, a Levi’s spokesperson said.
“This Maersk-designed and operated facility is an important step in our strategy to transition to a hybrid distribution and logistics network that balances omni-capable owned-and-operated facilities with technologically advanced 3PL facilities like this one,” Craig Jones, Levi Strauss' SVP of global distribution and logistics operations, said in the release.
