Argos to trial new distribution model

Argos is planning to trial a hub and spoke distribution model in January, which it hopes will offer rapid deliveries to its stores.

The trial, which forms part of a five year transformation plan that Argos hopes will reinvent itself as a leader in digital retail, was revealed in parent company Home Retail Group’s half-year results yesterday.

According to the statement, trials will begin in January 2013 and will test both operational efficiencies and the impact a hub and spoke distribution model will have on  Argos’ customers.

It hopes that a new distribution method will provide more cost-effective and quicker fulfilment on a wider range of products.

If the trial is successful, the retailer plans to roll-out the revamped distribution model during financial year 2015 -2016.

The retailer, which has its warehousing and transport requirements met by Wincanton, also plans to build on its express delivery options and large item home delivery service over the next five years.

Argos was unavailable to comment on where the distribution trial will take place and how long it will last for.

Home Retail Group’s half-year results to 1 September 2012 revealed that Argos slashed its operating and distribution costs by £5m compared to a year ago. Sister company Homebase also saw a £7m reduction in its operating and distribution costs.