Sunday 23rd Oct 2016 - Logistics Manager

Supply chain savings boost profits for WH Smith

WH Smith says it made cost saving of £18m in its high street business last year, mainly as a result of supply chain initiatives such as the introduction of voice picking.

Operating profit in the high street division was up four per cent to £56m for the year to 31st August despite a seven per cent fall in sales.

It said that cost savings remained a core part of its strategy and it was focusing on all areas of cost in the business.

“We have made good progress again this year, delivering cost savings of £18m. These came from right across the business, including the rollout of energy efficient tills to all High Street stores, the introduction of voice picking in our distribution centres, the remodelling of our transhipment routes to stores and other operational efficiencies.

“We also have a number of initiatives on trial such as: improving trailer configuration in our distribution centres; centralising energy management for stores; more self checkouts; and changing our web site hosting. We have identified an additional £10m of new cost savings, taking the target to £22m over the next three years.”

The group, which divides its operations between high street and travel, showed a six per cent improvement in pre-tax profit to £108m in the year to 31st August on sales down five per cent to £1.2bn.

Group chief executive Stephen Clarke said: “Looking to the year ahead, we continue to plan cautiously in an uncertain environment, however we are a resilient business and are well positioned for continued growth in both the UK and internationally.”