Lowes heralds supply chain network expansion, new direct fulfillment center

With an eye on improving same-day and next-day fulfillment options for customers, Mooresville, N.C.-based home improvement retailer Lowes Companies Inc. said this week laid out its plans for its supply chain transformation efforts focused on improving home delivery and to support increased demand from both do it yourself (DIY) and pro customers.

Company officials said that over the next 18 months, it will open up 50 cross-dock terminals, seven bulk distribution centers, and four e-commerce fulfillment centers, which also includes 20 cross dock terminals and one West Coast e-commerce direct fulfillment center (DFC), in Mira Loma, Calif., over the second half of fiscal 2020.

This announcement does not come as a surprise, as Lowes heralded a $1.7 billion plan to expand its distribution network through 2023 in 2018, which it said will create roughly 5,000 jobs.

“Providing customers more ways to shop has never been more important, and today's update on the progress made in our supply chain transformation highlights our ongoing and unyielding commitment to enhancing the customer experience in this new era,” said Don Frieson, Lowe's executive vice president of supply chain, in a statement. “Opening these new facilities will allow our stores to operate more efficiently through improved flow management and inventory visibility and improve the customer experience with more predictable deliveries, better in-stock rates and faster fulfillment options.”

What’s more, over the last 18 months, Lowes has made significant inroads to expand its supply chain capacity, including the opening of more than 13 different facilities across the U.S. in markets such as Chicago, Orlando, Riverside, California, and Columbus, Ohio, among others. And it said that “these facilities of varying sizes allow the supply chain to nimbly respond to meet the various needs of customers from small parcel packages to larger items, like appliances, grills and outdoor power equipment where Lowe's is the market leader.”

In an e-mail, Frieson said the objective of this announcement is to provide more same-day and next-day service offerings and enable faster e-commerce shipping across the country.

“The West Coast location will play an important role in meeting e-commerce demand with dedicated inventory to support our Lowes.com business,” he said. “The fulfillment center will offer faster shipping options direct to consumer. With the addition of the West Coast center to our Nashville DFC, Lowe’s will now be able to offer two-day delivery to nearly 100 percent of customers nationwide.

And a company spokesman said that opening these new facilities will allow Lowes’ stores to operate more efficiently through improved flow management and inventory visibility and improve the customer experience with more predictable deliveries, better in-stock rates and faster fulfillment options.

“They allow us to nimbly respond to meet the various needs of customers, from small parcel packages to larger items, like appliances, grills and outdoor power equipment where Lowe’s is the market leader,” the spokesman added.