CRC pours in millions to boost logistics

Central Retail Corporation (CRC), the country's largest retail business, has invested Bt200 million in logistics development to serve its expansion in the provinces and China.

Danai Galassi, vice president for the supply chain, said yesterday that the company would spend a major part of its budget on opening two new cross-docking hubs in the South and the North to manage transport and distribution. One will be in Chiang Mai and the other in Surat Thani, and they are expected to open services next month.

He said CRC had also enlarged its distribution centre at Bang Na-Trat Kilometre 20 from 15 rai to 18 rai (nearly 3 hectares) to support distribution for all business units in the Central Retail chain such as Central Department Store both domestically and in Hangzhou, China. Robinson Department Store, Supersports, B2S, Office Depot and PageOne are also served by the centre.

Danai said Robinson was also moving its distribution centre at Bang Kae, west of Bangkok, to the Bang Na distribution centre, in the capital's east.

Therefore, the company needs to reschedule its logistics routing to support not only subsidiaries under the Central group, but also more than 3,800 companies with total orders of more than Bt40 billion a year - both suppliers and retail-space tenants - that CRC provides logistics services for.

"We have tried to manage our logistics services more efficiently. This year, we are focusing more on how to distribute products quickly in response to our retail business that has grown significantly in the North and the South, resulting in a 15-per-cent increase in logistics services by volume," Danai said.

The two new hubs will be its main strategy this year to resolve a bottleneck problem when products are transported from Bangkok to the North, where a Robinson Department Store recently opened and has seen good response.

In addition, the company is using larger vehicles - 18-wheel trucks - to deliver goods from Bangkok, and then distributing them with four-wheel or six-wheel trucks to stores in the North and the South.

"This can help the company save transport cost by 10-15 per cent per time," Danai said.

He said CRC had also prepared for overseas-transport management, as the group recently opened a Central Department Store in Hangzhou in eastern China's Zhejiang province and plans launches of two more stores in Shenyang in the northeastern province of Liaoning under the Central and Zen brands this year.

Moreover, the company has given more importance to helping its suppliers deal with higher transport costs driven by rising oil prices. After CRC moved the Bang Kae distribution centre to Bang Na, it offered a scheduled delivery service for its small suppliers in the Rama II and Petchakasem areas in a bid to cut transport costs by 15-20 per cent per trip.

"We expect to see an increase of 8-10 per cent in transport by volume this year," Danai said.