Using existing assets
28 February 2021
It is very interesting to see Asda adapt its stance to last mile in its latest consultation. The review comes less than a month after venture capitalists bought a controlling stake in the firm.
It proposes the closure of its two Dartford and Heston regional delivery hubs in the South East of England.
Instead, the grocer plans to serve the increasing number of customers shopping online by expanding its ‘in-store pick’ model – projecting the creation of 4,500 new roles in store-based online operations across the country.
It is an interesting move because it puts the emphasis very much on the existing assets within the group - store staff, store space and in-store stock. Perhaps as well as creating greater capacity, improving slot availability and allowing Asda to get deliveries to customers more quickly, it will also allow them to control costs? It has long been a tricky nut for retailers to crack, as home delivery is inherently more expensive than the store model. But with stores increasingly under-utilised post-pandemic, it makes sense to re-use these assets.
The alternative of cutting back sharply on these assets would certainly be more painful.