Based in the East Midlands and sitting pretty much at the very heart of England, the famous ‘Golden Triangle of Logistics’ has continued to attract investment from the logistics sector for decades due to its excellent connectivity. In close proximity to the M1, the M6 and the M69, as well as being served by the M40, it provides the perfect strategic location for home delivery companies who place emphasis on speed and convenience.
Two weeks ago saw Tamebay visiting Hermes Rugby warehouse, which put down roots within the Triangle – materialising their growth ambition in August 2017 when they officially opened their Midlands Super Hub at the Rugby Gateway in Warwickshire, incorporating two fully-automated sortation tiers manufactured by Beumer.
We were welcomed to the hub by Jon Ormond, operations director of Hermes, who toured us through the space of 270,000 square feet. The flagship hub, which cost £31 million, remains the biggest of its kind in Europe. Following on from the completion of the company’s huge distribution facility in Warrington in 2013, the Rugby hub was built to further strengthen operations in light of several successive years of growth – and was originally designed to handle approximately one million parcels every day.
However, despite sanctioning the most substantial investment in Hermes history to date, the senior team at Hermes had the foresight to make the hub future proof, which included the capability to add a third sortation tier – a process that has just been completed ahead of the upcoming peak. The £16m project enhances existing output by 40% with the capability to process 1.35 million parcels each day.
Speaking to Jon Ormond, operations director of Hermes about the decision behind choosing Rubgy as a location for expansion, he attributed the move to the efficiency of transport links. “Rugby was an obvious location for Hermes as we looked to invest in our network and boost capacity. However, due to our rapid growth, we knew we had to put plans in place that would allow us to quickly scale up even further – and that is why we took the decision to leave necessary space so we could eventually construct a third sortation tier. After another highly successful peak season in 2017, we decided to push ahead with the third tier.”
“This additional investment of £16 million brings the total outlay to £47 million, but what is clear is that we now possess the largest, most efficient parcel distribution facility in the UK, if not Europe. This demonstrates our commitment to retailers who are continuing to invest heavily in ecommerce.”
The installation of the high specification sortation tier – once again manufactured by Beumer – has taken place over the past 12 months, overseen by the company’s in house engineering team who ensured that the hub has remained fully operational. The new tier can sort 22,973 items per hour which increase the hub’s hourly total to 68,919 items per hour. It measures over 1.1kms in length, incorporates 480 tonnes of steelwork, features 1,942 trays, and is powered by 41kms of electrical wiring. Scales measure the dimension and check the weight of every parcel whilst also checking for any damages.
Commenting on the completion of the third tier, Martijn de Lange, CEO of Hermes UK, said: “I’m absolutely confident the third sortation tier in Rugby will put us in the strongest possible position to further support the retail industry over the coming years.”
“For the last few years, we have witnessed double-digit growth due to our commitment to investing in our world-class network and infrastructure, our innovative fleet and our industry-leading portfolio of services solutions. In addition, our in-house engineering team is constantly optimising our equipment to ensure it is best in class and we will soon be introducing further automation to support our returns process in the coming months.”
However, Hermes’ investment extends beyond sortation tiers – with the company also enhancing their fleet of vehicles that serves the hub on a daily basis. Following an initial 12-month trial of Compressed Natural Gas (CNG) vehicles with CNG Fuels – the only UK supplier of Renewable Transport Fuel Obligation (RTFO) approved biomethane – Hermes initially ordered 30 Iveco Stralis CNG units, which were integrated into the fleet over the following months. This was the largest opening order of CNG tractor units from any UK company.
Hermes have now pushed ahead with stage two of their investment, which has seen the number of CNG vehicles within their fleet rise to 72. This number will grow to 78 before the peak season later this year. The vehicles are refuelled at Hermes’ Warrington hub and at third party stations in Leyland and Daventry.
Each of these vehicles reduces CO2 emissions by over 80% vs a comparable diesel Euro 6 vehicle, resulting in a reduction of around 150 tons of CO2 per vehicle per year and a reduction of 11,700 tons of CO2 across the 78 CNG vehicle fleet per annum. Other benefits of the CNG vehicles include 70% less NOX, 99% less particulate matter, 90% less NMHC and 88% less methane.
The countdown to Black Friday and Christmas 2019 is already on and industry commentators are already predicting record sales and volumes, despite low consumer confidence throughout the year. As a result, logistics companies have a responsibility to support their retail clients by increasing their capacity – and it is clear that Hermes is just doing that, both within their hubs and on the roads.