Federated’s direct channel building boom continues
Federated Department Stores is planning to build and open a second fulfillment center for Macys.com and its direct-to-consumer business.
This spring, Federated, No. 29 in the Internet Retailer Top 500 Guide, will open a 600,000 square foot facility located near Portland, Tenn., that will service only Macys.com and Federated’s direct-to-consumer business.
But Federated also is planning to invest $100 million and build a similar distribution center in Goodyear, Ariz., to support fulfillment for its growing web business. “A new direct-to-consumer distribution center is being planned, although it has not yet been finally approved by Federated`s board of directors,” says a Federated spokesman. “It would serve the western U.S., while the one in Portland would serve the eastern U.S.”
A spokesman for the city of Goodyear says that Federated expects to break ground on the new facility in March. The first phase of the project calls for constructing a 603,000 square foot facility and later on an additional 351,000 square foot building. The first phase of the facility will employ about 850 workers, including 480 full-time and 370 part-time employees, the city says.
An Arizona fulfillment hub will serve about 30% of Federated’s online shoppers who live in the western U.S. “The facility will provide proximity to the end customer,” says the Federated spokesman.
Federated expects direct-to-consumer sales to grow to more than $750 million by 2008 from about $450 million in 2005.
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