Analysis: The missing piece in the GXO Logistics jigsaw
Never say never
Union leaders representing some 200 XPO Logistics employees in north-west London have called for a meeting with management after it was announced that a warehouse the logistics provider operates for retail giant Marks & Spencer in Neasden is to close.
The move follows a decision by M&S to consolidate its southern UK supply chain operations at a former Tesco site at Welham Green, outside London, and is part of wider plan to adopt a single-tier distribution network for its apparel and home goods.
Gordon Mowat, director of clothing & home supply chain & logistics, said: “M&S is changing and we are transforming our stores and supply chain to better serve our customers.
“The new site in Welham will deliver better service and availability for our customers and enable us to become a faster, more agile, lower-cost retailer. The location has fantastic transport links and we’re looking forward to building a great operation in Hertfordshire.”
The 495,000 sq ft site will become a mechanised clothing distribution centre, serving 150 stores in the south-east, M&S said, adding that its operation would be contracted out to a third-party logistics supplier and is ultimately expected to employ over 500 people.
It is scheduled to be operational in the first half of 2019 with continuing development expected over the following two years. It will ultimately be able to handle 70 million items.
The facility in Neasden employs 380 and is operated by XPO, with transport operations run by DHL, and will continue until M&S’s lease expires in March 2019.
Mr Mowat said: “Unfortunately, a number of factors, including cost, location and size, meant renewing the lease was not viable – this is not a reflection on the quality and output of the work done in Neasden, but the result of a wider strategic review.
“Over the next 15 months the site at Neasden remains a critical part of the M&S logistics network and we will continue to work closely together with them to deliver a great service to both our stores and our customers as we have always done.”
Tony Warr, regional GMB senior organiser, said the news would be “devastating” for the employees, who are expected to be either offered redundancy or a transfer to the new site.
He said: “The site has been successfully providing a warehouse and distribution service for Marks and Spencer for many decades and it looks as though the workers are going to pay the ultimate price due to the failures in the retail market of Marks and Spencer.
“One of the questions we will be asking is whether XPO can lease the site and hopefully attract other business in order to mitigate the loss of the Marks and Spencer work.
“We feel there is sufficient time to do this, given the date for the closure is over a year away. If successful, this will send a positive message to the Neasden workforce and also to workers at other XPO sites that their employer does not simply intend to walk away from such a dreadful situation,” he added.