Mothercare: logistics problems drag on
Mothercare has extended a contract to back up its distribution.
As its damaging distribution saga rumbles on, Mothercare has re-signed an expensive back up warehousing contract. The market is seeing the move as an underlying lack of confidence in its accident-prone logistics provider, Tibbett & Britten.
Troubled UK high street retailer Mothercare, has extended a back up warehouse contract for another year in a move that is seen as a palpable lack of confidence in its existing centralized distribution provider, Tibbett & Britten.
T&B was supposed to meet all of Mothercare’s distribution needs through a warehouse located in Daventry, but operations have been hit by a succession of problems, forcing the Mothercare management to look for a backup facility. This contingency cost the company GBP3 million, before the announcement of the contract extension.
The Daventry operation has been beset with problems resulting in the erratic supply of goods to stores. This situation has been blamed for poor sales and for causing the hard presses retailer to issues three profit warnings within a year as well as the halving of its share price.
T&B will not welcome the ongoing bad publicity. However, it does demonstrate the importance to manufacturers and retailers of getting the supply chain right. Although still very much the poor relation in the board room, logistics will have forced its way onto many CEOs’ agenda. The risks of getting things wrong are more than evident to see – although this may be cold comfort for Tibbett & Britten.
