Debenhams has signed a £113 million logistics contract with DHL Supply Chain, extending its 12 year relationship with the firm until 2012.
Under the three year agreement DHL’s fashion unit will continue to develop and provide all Debenhams’ warehouse and distribution services to 157 stores across the UK and Ireland.
DHL operates all three of Debenhams’ UK distribution centres, providing a range of transport and warehouse services including supplier collection, store deliveries, outbase and cross-dock operations.
The department store has recently undergone a two year cost improvement programme delivered through internal process reviews, operational developments and streamlining, including advancements in warehouse picking operations.
Debenhams has managed to cut the cost per unit by more than ten per cent since 2006/07.
The retail chain has also made environmental savings by introducing super cube trailers and double deck trailers, allowing it to reduce kilometres travelled by 792,000 and fuel burnt by 203,000 litres.
It has also added Euro 5 compliant vehicles as standard to its fleet since 2006 and reduced carbon dioxide emissions by 517 tonnes year-on-year.
Paul Leggett, head of logistics for Debenhams, said: “One of the other key changes in recent years has been the evolution of an advanced warehouse solution that now better allows DHL to focus its resources on moving Debenhams high priority product lines more swiftly through the supply chain.
“This in turn has helped us become more agile with our promotional activity and supported the large transition to more own bought product that occurred this year.”
DHL has also taken over the operation of three off-site stock rooms, allowing it to develop new services.