Woolworths Group and Qube have announced plans to invest in an automated Regional Distribution Centre and a semi-automated National Distribution Centre in New South Wales. The total investment in the facilities from both companies will reach approximately $1.2 billion.
Located in Moorebank Logistics Park, Sydney, the two state-of-the-art facilities are set to transform the NSW supply chain network with investment in the new high-tech Distribution Centres (DC) that are set to open in 2023 and 2024.
Woolworths Group will invest up to $780 million in the technology and fitout of the two distribution centres over the next four years and has signed an initial lease term of 20 years with Qube Holdings.
Qube will invest between $420–$460 million to build the warehouses, bringing the combined investment from both companies to approximately $1.2 billion into the roll-out of the new DCs, which are still subject to state Government planning approval.
Both sites will build on semi-automated and automated technology deployed at Woolworths’ Melbourne South Regional Distribution Centre, which has been servicing Victorian stores for more than 12 months.
Transforming NSW supply chain
Woolworths chief supply chain officer Paul Graham said the investment at Moorebank will transform the way it serves its NSW stores, strengthen its network and deliver on its ambition to create Australia’s best food and grocery supply chain.
Graham said cutting-edge automation will build tailored pallets for specific aisles in individual stores, helping the group improve on-shelf product availability with faster restocking, reducing congestion in stores, and enabling a safer work environment for its teams with less manual handling.
“The new facilities will also help progress our localised ranging efforts, with the ability to hold many thousands more products centrally than we can in our existing facilities,” he said.
According to Graham, the Group learnt a lot from its ground-breaking development at the Melbourne South Regional Distribution Centre (MSRDC).
“After hitting new volume milestones and dramatically improving the speed and accuracy of deliveries, MSRDC is now consistently supporting our Victorian stores – giving us confidence that now is the right time to invest in this new technology for our NSW network,” he said.
Australia’s largest freight infrastructure project
Moorebank Logistics Park, Sydney, is Australia’s largest freight infrastructure project and will link Port Botany direct to rail terminals and warehousing on a 243 hectare site.
Once established, the Moorebank facilities will replace the current ambient operations at Woolworths’ Sydney Regional Distribution Centre (Minchinbury), Sydney National Distribution Centre (Yennora) and Melbourne National Distribution Centre (Mulgrave). These sites are expected to close by 2025.
Infrastructure investments by the Federal and State Government at Moorebank Logistics Park were key to Woolworths’ site selection.
The direct rail access to Port Botany will provide strategic benefits for Woolworths’ transport network and help remove at least 26,000 of its truck movements from NSW roads each year.
Qube Managing Director Maurice James said Woolworths’ long-term commitment will reinforce the commercial appeal of this nationally important infrastructure and freight project.
“The benefits of railing containers direct from Port Botany to a terminal co-located with warehousing across a site the size of the Sydney CBD will deliver Woolworths time and cost efficiencies,” he said.
“Our project team is looking forward to working with the Woolworths team in delivering an optimal solution for their operations.”
Graham said it will undoubtedly be a challenging transition.
“We explored options to upgrade our existing sites, but the ageing infrastructure just won’t be able to support the growth in volumes we’ll need to service in the years ahead,” he said.
“We’ll look to offer redeployment opportunities wherever possible with 650 roles available at the new Moorebank sites, as well as providing a wide range of support and career transition services to our team well before site closures.”