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Swisslog wins supply chain deal

Furniture retailer IKEA has awarded systems provider Swisslog a massive £22m contract for the implementation of a supply chain...

Furniture retailer IKEA has awarded systems provider Swisslog a massive £22m contract for the implementation of a supply chain distribution system, to help cope with demand from its customer order business.

The customer order business, which allows customers to order products via conventional mail, on the telephone or over the Internet, is growing very quickly, according to IKEA.

In a bid to satisfy demand the retailer has contracted Swisslog to provide supply chain systems and software for two new customer distribution centres in Sweden and Germany and a further distribution centre being built in Sweden.

IKEA hopes to shorten the customer delivery times by half - from 14 days to one week - and cut costs through more effective stock handling and order picking in the distribution centres

There are no immediate plans for a UK-based customer distribution centre but an IKEA spokesman said that additional distribution centres were planned for Europe.

Swisslog will provide logistics, project management, installation, customer support and training.

The company will also provide its warehouse management system software for the new distribution centres, which will be developed into the standard for IKEA's future centres worldwide.

The warehouse management system software will perform internal processing such as control of warehouse stock and order picking management. Swisslog said work will start immediately, with operations beginning in 2002.

Daniel Thomas
daniel.thomas@rbi.co.uk

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