New Macy's distribution, fulfillment center 'redefines big' - Business, Government Legal News from throughout WV

SLIDESHOW: New Macy's distribution, fulfillment center 'redefines big'

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By MAGGIE WOLFF PETERSON

For The State Journal 

MARTINSBURG — At nearly 1.3 million square feet on two levels with 14 miles of conveyor belts, 400,000 square feet of storage for housewares, nearly 1,000 employee lockers, and space for 9 million kinds of shoes, Macy's new fulfillment and distribution center in Berkeley County is the largest for the retailer, and perhaps the largest in the world.

Built on 92 acres in the Cumbo Yard Industrial Park north of Martinsburg, the facility is bigger than 27 football fields, with eight conveyor lines bringing in products to be separated into 176 separate fulfillment lines. A bank of 12 large-screen televisions project plant operations to a staff stationed on a second-story bridge that managers compare to air-traffic control. On one line alone, 825 specialized tilt-trays drop products down 1,600 chutes in the world's largest system of its type. At top capacity, the center will prepare 15,000 packages hourly for shipping.    

On July 18, officials from Martinsburg and Berkeley County, as well as the state Legislature and U.S. Congress, assembled for a ribbon-cutting at the facility, which has already been operating for 10 days. The center currently employs about 500 of the 2,000 workers it will need during peak operations at the holidays. During normal operations, the center will employ 1,200 workers on 10-hour shifts, from Monday to Thursday, and 12-hour shifts on Friday through Sunday. The annual payroll is estimated at $30 million.

After rising for the Berkeley County Junior ROTC's presentation of the colors and the Pledge of Allegiance led by local Girl Scouts, the crowd heard speakers ranging from the company's CEO to Sen. Joe Manchin, D-W.Va., acclaim the openness of West Virginia to new business and the fine relationship between Macy's and state officials that brought the distribution center into being.

Macy's considered 160 different locations before selecting Berkeley County, with its easy access to Interstate 81 and location central to the Mid-Atlantic region, speakers said. Additionally, the community's work force was a large factor in attracting the retailer. As part of the ceremony, Peter Longo, president of Macy's logistics and operations, presented a $10,000 check to Peter G. Checkovich, president of Blue Ridge Community and Technical College, which will offer training to distribution center employees.

The distribution center responds to a corporate strategy, called "Omnichannel," which allows the retailer seamless operations between brick-and-mortar store locations and electronic sales. In addition to an online presence at Macys.com, in-store cash registers are equipped with a "search and send" Internet access feature that allows salespeople to jump from actual to virtual retail with a click. If a customer can't find the right size or color in store inventory, a salesclerk will find it online. 

Consumer habits are changing, Macy's chairman, president and CEO Terry J. Lundgren said. A buyer is likely to visit a store to examine merchandise, "then buy it on their mobile device later," he said.

The Martinsburg facility will "support a very fast-growing Omnichannel business," Lundgren said.

Online sales grew 40 percent last year and another 30 percent already this year, Lundgren said. Macy's expects revenue of $2 billion this year in online sales.

"And at this rate of growth, it will soon be $3 and $4 billion," Lundgren said.

The company began building distribution centers five years ago in Tennessee.

"We thought that was pretty big and pretty sophisticated," Lundgren said of the Tennessee site.

Other centers are in Arizona and Connecticut. But the Martinsburg site, selected in 2010, dwarfs them all.

"This is big," Lundgren said. "This redefines big."

The building is so large, engineers "had to take into consideration the curvature of the earth when we were pouring the foundation," he said.

Sen. Manchin spoke of the team effort involved in bringing Macy's to West Virginia, for which groundwork was undertaken during his time as governor. The distribution center cost $150 million to construct and involved 3,000 workers in contracting and construction work.

And the benefits to West Virginia will ripple further, Manchin said. The state will be able to demonstrate to other companies that the Macy's distribution center has been an effective corporate investment.

"Right now, you'll be our best salesperson, Terry," Manchin said to Lundgren.

Capito echoed the sentiment, saying that "you're going to show the rest of the folks in the country that West Virginia is a leader."

And to workers, outfitted in Macy's red T-shirts and assembled for the event, Manchin said, "I can see in your eyes that you have an opportunity now. If this does well, you'll do well."

In her address Capito referred to herself as a "Macy's and online shopper," joking that the center will fulfill a woman's fantasy. "Think of all the women's shoes," she said. "I'm just dreaming."

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