Chewy to close 2 traditional distribution centers to save costs!

It is learned that Chewy CEO Sumit Singh said in a financial report conference call last week that two old distribution centers will be closed and more orders will be introduced to new automated warehouses. "For a variety of reasons, we continue to move orders to automated facilities to reduce order processing costs."

That will help the company reduce fulfillment costs. Sumit Singh said in December that Chewy's automated fulfillment centers in Archbold, Pennsylvania, and Reno, Nevada, are about 18% to 20% cheaper than shipping from its traditional network.

Chief Financial Officer Mario Marte noted on a conference call last week that it will be able to handle more order volume through its automated warehouses. The company also has an automated warehouse in Belton, Missouri, and plans to open another in Mount Juliet, Tennessee, this year.

It is learned that despite a 4.2% year-on-year increase in order shipments, Chewy's fulfillment costs remained unchanged at $1.2 billion in fiscal 2022, according to the company's latest financial report data. It is reported that the company has also reduced operating expenses by improving "cartonization" or the ability to pack more customer orders into a single package. This enables the company to reduce shipping and packaging costs.

Editor ✎Estella/

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