Next year, digital retail giant Shop Direct will open its massive new fulfilment centre at Castle Donington’s Segro Logistics Park East Midlands Gateway. Business Live’s Robin Johnson went along to the 550,000 sq ft building to see how preparations are coming along.
It sounds like the name of a yet to be made James Bond film but at Skygate, the name of Shop Direct’s massive new fulfilment centre, there is technology that wouldn’t look out of place in one of 007’s adventures.
Currently, much of this technology is being put through rigorous testing, ahead of the digital retailer starting operations at the Castle Donington site next year.
But once it is up and running, it should provide a digital retail operation as quick and as smooth as one of Mr Bond’s one-liners.
Skygate will bring Shop Direct’s Very.co.uk and Littlewoods.com retail brands under one roof for the first time.
The building at Segro Logistics Park East Midlands Gateway will feature a floorspace of just under a million sq ft across three levels and at peak times employ in the region of 800 people.
Shop Direct is just one of a number of major brands that has so far committed to space at East Midlands Gateway.
Logistics firm Kuehne and Nagel has already started operations at its base there, while a couple of doors down from Shop Direct.
According to Phil Hackney, Shop Direct’s chief operating officer, the East Midlands Gateway site came along at precisely the right time for the business.
The new Castle Donington site is replacing the firm’s existing operations in Manchester.
And while the closure of those sites is disappointing for Manchester, the new East Midlands base will allow Shop Direct to continue to grow and help keep up with the ravenous appetite of the online retail market.
“It was a tough decision to leave,” concedes Mr Hackney. “But we realised that the Manchester sites were coming to the end of their lives.
“It was a hard call to make, particularly as we have staff there who have been with us for many years. That was why we informed those workers two years before the move, giving them plenty of time to assess their options, with the support of a taskforce involving ourselves, local government and the Mayor Andy Burnham.
“We had been considering a new location for some time - and East Midlands Gateway was attractive to us for a number of reasons.
“Firstly, its location - being in the centre of the country made far more sense for a company like ourselves. Secondly, its transport links - here we are right in the middle of the major road network, we will be served by our own freight terminal and we are right next to East Midlands Airport, one of the largest pure freight airports in the country.
“Finally, East Midlands Gateway presented an opportunity to design a brand new fulfilment centre from the ground up. A lot of work has gone into designing and implementing technology and processes that will allow us to keep up with and meet the demand of consumers.”
Even though it is still some time before Skygate starts processing orders, the work that has been done so far inside Shop Direct’s new building is impressive.
The firm is implementing systems that will see an order processed within 30 minutes of it being placed and the company is investing tens of millions of pounds in technology that will allow it to achieve this goal.
The whole process begins at one end of the building. Stock delivered to the site is sorted by machine into plastic totes, with the waste cardboard and plastic separated and sent away for recycling.
The totes are then stored in huge swathes of racking, patrolled by robots that spring into action, when an order is placed.
The robots locate the tote containing the required item and then takes it to the picker, who sorts out the order ahead of it going to packaging and then dispatch.
All of this is overseen by staff housed in the ‘flow room’, which is essentially the nerve centre of the whole operation. Here, engineers monitor all of the technology, ensuring this 24/7 operation runs smoothly.
Mr Hackney said: “While we are using technology to carry out much of the manual tasks, our whole operation still very much relies on human beings.
“Technology is useless if you do not have the right people operating it.”
The site will eventually employ 500 permanent staff, supported by an extra 200 to 300 agency staff during peak periods.
The value placed in the human element is already evident at Skygate - even though the only people working their at the moment are the engineers, installing and testing the technology.
The building itself has a range of facilities, including an on-site restaurant that would not look out of place in a hotel and a recreational area which will eventually house a gym and host yoga sessions. Skygate even has its own prayer room and an outdoor multi-use sports pitch. All of these facilities will be available to every Shop Direct worker.
Mr Hackney said: “As a company, we make a point of listening very closely to our staff, asking them what they want. We’ve taken many of these suggestions and implemented them at Skygate.
“The whole idea of working in a warehouse has changed. The job has evolved. It is more technical. The human element is more valuable than the machines - and this will always be the case.
“So, it’s important that we create an environment in which people enjoy coming to work.”
According to Mr Hackney, the new East Midlands Gateway fulfilment centre represents a massive investment for the firm - but one which he is confident will reap dividends in the long-term.
Currently, Shop Direct sells more than 1,800 brands, including big name labels and its own exclusive brands. It has four million customers and delivers 49 million products every year.
Skygate will certainly give the firm more capacity - but crucially it will reduce the cut-off times for next day delivery and offer the potential for same day delivery in the future.
Mr Hackney said: “The facility will ultimately play a key role in helping us meet the ever-changing needs of our four million customers and will position ourselves for ongoing, sustainable growth in the future.
“In just three short years we have gone from this new facility simply being an idea to becoming a reality. I’m now really looking forward to Skygate swinging into action.”
Shop Direct is still in the process of recruiting for Skygate. For technical or leadership roles visit shopdirect.jobs. For fulfilment, training or admin roles contact Shop Direct’s recruitment partner Mach at SD@mach.co.uk or call 07803 428425.
