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Establishing a Central Distribution Infrastructure in the 1970s

 

A panorama of the huge Woolworth Distribution depot at Castleton, Rochdale, Lancashire (1967-2008)

 

After computerising in the Sixties, Woolworth turned its attention to its distribution network. It aimed to save money by collating goods centrally and shipping to the stores by road. It hoped that the approach would reduce the number of shipments that suppliers made direct to the stores, and would reduce the amount of money tied up in excess inventory. The strategy also reversed an earlier decision to ship products by rail.

Woolworth had opened its first modern Warehouse in Chicago, Illinois, USA in 1963. The depot pioneered state-of-the-art computer systems for accounting, ordering and inventory management. The idea had been adopted, largely unchanged in Britain at a similar site in Castleton, Rochdale. This was chosen partly because of its railway sidings and railhead loading dock. The chain had distributed goods by rail since before the First World War and appeared unaware that as the 1962 Beeching Report took effect, the country's rail infrastructure would be decimated.

By 1970 the depot was fully operational and serviced a thousand Woolworth and Woolco stores across the British Isles. It also despatched goods in containers to the 100 branches across Ireland, the Scottish Highlands, the Channel Islands, the Isle of Man and in the Carribean. Every branch received at least one delivery a fortnight.

 

A forklift truck in operation in the Castleton Distribution Centre in the late 1960s

 

The initial layout of the depot was unusual. It was managed by former store managers, who decided to arrange the storage into individual sections for each branch. These were operated as overflow stockrooms, exactly as if they were above or below a salesfloor.

The approach allowed seasonal goods to be collated and held out of the way until they were needed in-store.

Electric trucks were used to drag pallets around the site. Fork lift equipment was used to put goods away and to lower cases from upper shelving to picking bins where goods were selected into large stock trolleys.

 

A putaway in the early days of Woolworths' Castleton Distribution Centre

 

 

 

The Warehouse handled about a third of the firm's total throughput of goods. Each year it processed over a billion pounds worth of despatches at today's prices. From the outset it was staffed by local people.

 

Stacking goods onto a conveyor for transfer to the railhead at Woolworths Castleton Distribution Centre

Store orders, topped up by allocations of new items from the chain's buyers, were keyed into a computer in the Administration Block. Twice a day the ICT Mainframe sent batches of picking instructions and delivery notes to large impact printers in the depot, where they were printed on punched and perforated A3 listing paper.

Scanning technology was adopted in 1975 to avoid the need for clerks to transcribe store manual orders.

Goods were picked into stock trolleys. When full these were taken to a central conveyor belt, which carried thousands of boxes through a central gangway in the warehouse.

 

Goods on their way to the railhead in the original Woolworths Distribution Centre in Castleton in the period 1967-1971

 

 

Goods were doubled-checked, with any damage to the boxes made good before being sent up a steep conveyor to the railhead. On the other side of the wall in the top left of the picture, the goods were dropped into railway wagons waiting beneath. A complex network of tracks and sidings was needed to guarantee a steady supply of wagons, marshalled together ready for despatch to different areas of the country.

Despite some of the difficulties with the logistics, rail transport was efficient, cheap and (although not considered at the time) very environmentally friendly.

 

The tracks were still visible in 2008, when the one-time marshalling area served as a staff car park for the Castleton Site.  Sadly, despite featuring that year at an international SAP conference as a role model distribution facility, no-one could be found to take the site over when the business went into Administration in November 2008.

In 1971, just four years after opening, disaster struck when a fire swept through the warehouse. One of the three chambers was burnt out, while the others were severely damaged. Virtually the whole of the chain's reserve stock was destroyed. This led to a £30m insurance claim, the largest that had ever been made in North West England.

The firm took the incident as a wake-up call. It was agreed that the plant would be reinstated as a road depot, and would incorporate state-of-the-art fire protection. Plans for a second, purpose-built Distribution Centre in Swindon, Wiltshire were expedited.

As part of the reconstruction, the railway sidings and original chambers were converted into a staff car park. The tracks were still visible underfoot, embedded in concrete, when the store chain collapsed in the credit crunch of 2008.

 

By the mid Seventies two large Distribution Centres provided the main storage facilities for the 1000+ Woolworths stores in the UK and Republic of IrelandFour regional Transhipment Centres played a key part in the 1970s Distribution Strategy - they were used to cross-dock large shipments of seasonable products between suppliers and the stores without ever storing them away.

The firm was encouraged by the early success at Castleton and determined to broaden the network. They launched a search to find a second location and chose Swindon in Wiltshire, which would help them to cover the British Isles more efficiently. It opened in 1972. Freightliner (rail freight) transport was initially used to transfer stock between the two main warehouses, but both progressively switched to road transport for store deliveries. Four additional Transhipment Centres were established to split supplier deliveries and send the products straight on to the shops without storing them away. This approach to supply chain management, which is known as cross-docking, remains a popular practice among retailers and manufacturers in the twenty-first century.

 

The management offices at the new Distribution Centre in Faraday Road, Swindon, Wiltshire, which opened in 1973

 

The first stage of the plan was to open a second Distribution Centre in Swindon on a purpose-built greenfield site. The building costs were estimated at a hefty £9.1m, which was paid for on a long-term mortgage. This provided a total of 430,000 square feet (approx 40,000m2) of storage, plus 96,000 square feet (approx 8,900m2) of loading bays and 40,000 square feet (3,700m2) of offices in a three-floor block. The total space was 567,650 square feet (52,600m2). Once the fire restoration of the Castleton Warehouse was completed, the two Distribution Centres worked side-by-side, one serving the north of the mainland, Ireland, the Isle of Man and the Scottish Islands and the other serving the stores across the south and west, the Channel Islands and branches in the Commonwealth.

 

This 70s aerial photograph of the Swindon Distribution Centre illustrates its huge scale.

 

The site had its own computer room as part of the suite of management offices. The chain opted to choose a mainframe from a new supplier, IBM. As well as running the local warehouse and a new instalment credit operation, the platform provided a recovery and back up site for the main centre at Castleton.

 

A tractor and trailer lorry unit from the Woolworth fleet, operated by National Carriers Ltd. in the 1970s

 

A diagram explaining the Transhipment Centre operation at Woolworths in the 1970s

 

The crowning glory of the distribution strategy was four regional Transhipment Centres in Bristol, Radlett (Hertfordshire), Warrington and Cumbernauld near Glasgow. Unlike the Distribution Centres these were not stockholding locations, simply sorting goods received from suppliers and sending them on to stores within a fortnight.

 

The chain's Radlett Transhipment Centre in Hertfordshire

 

The whole strategy was driven by Woolworth's strong sales of fast moving consumable goods at a time when the stores stocked groceries, toiletries and soap powder. The mass market appeal of these goods provided the throughput to operate the network economically.

 

Mechanical sortation equipment for cross-docking at the Radlett Transhipment Centre

The mechanical handling equipment allowed goods to pass through the Transhipment Centres very quickly, making them ideally suited to perishable lines like growing plants - everything from trees and shrubs to bedding plants passed through the centre with a steady flow of lorries from the principal suppliers.

 

The interior of a 1970s transhipment centre

In addition to the Distribution and Transhipment Centres Woolworths also had special distribution arrangements in place for:

  • delicatessen and some foodstuffs via the "External Distribution Service" or EDS, operated by Adams Foods from their nationwide network of depots
  • furniture had dedicated warehousing in Burnley, Lancashire
  • catalogue products for Shoppers World were housed in nearby Heywood
  • hanging garment clothing items, which were handled by Tibbet and Britten
  • Entertainment products, which were sourced through Record Merchandisers Limited. The wholesaler was later acquired and operated as Entertainment UK Ltd within the Kingfisher Group and later Woolworths Group PLC.

Several major suppliers, including Cadbury's, Rowntrees, Mars and Tobler Suchard delivered directly to the stores using their own transport.

 

The purpose-built railhead is mothballed at the former Castleton Distribution Centre today. With the latest focus on carbon footprints and the environment, who knows, maybe anew owner of the site brings it back into action!

 

After all of the investment of the 1970s, within a decade the transhipment network was dismantled, with the asset value written off. The depots were sold as going concerns, with some of their staff retained. When Woolworth changed hands, the new management updated the firm's merchandise mix, choosing to eliminate most of the fast moving consumable goods and to specialise in a smaller number of ranges. This meant that the facilities were no longer required and led to the disposal.

In the Eighties the Castleton railhead itself was fenced off. It still sits mothballed alongside the railway as the whole depot stands idle. Perhaps a new owner of the site will bring it back into use one day.

 

A panorama picture of the Castleton site in 2008. The Central Accounting Office and Distribution Centre sat side by side, with a large marshallng yard for tractors and trailers between the two. No-one knew at the time that the picture was taken that the award-winning facility had only a few more weeks to operate before the business that it had served for more than forty years collapsed without trace, meaning it was no longer needed.

 

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