I didn't Macy's would have a retail storefront in this warehouse. If Costco brings a distribution warehouse to the state let's have this conversation.
Supply Chain and Distribution is my gig, so I probably like the minutiae of this topic more than most, but the recent comments related to a retail store versus a DC are really interesting to me. Just on the surface, a Macy's store and a Costo store are simply not equivalent. Macy's is a non-grocery traditional retail outlet, with smaller stores, etc, and Costco is a bulk-type storefront. Closer to a distribution center than a traditional retail store.
Even in store numbers, it's not the same. Macy's has something like 800 stores in the US, while Costco only has about 400, or roughly half. Of course, the Costco stores are much larger, employ more people, etc. But this difference in store size and numbers, as well as industry dynamics like the continuing Omni-channel evolution, dramatically changes the nature of the distribution network.
Macy's has nine major DC locations in the US, which is a small number for such a large store network. But they are heavily investing in omni-channel, and are rapidly converting retail stores to fulfillment centers as well (500 stores acting as fulfillment centers is the current estimate) and or so are reducing the overall number of regional DCs, while at the same time making the existing DCs larger.
What does that mean related to Macy's stores and DCs? Basically, it means Macy's can much more easily add and remove stores (or change locations, etc...), but it is much more difficult and costly to change their DC network. In short, given that Macy's is actually reducing their net number of DCs nationally, we were fortunate to get chosen, and it is going to be here for quite a while. (And I don't care who gets credit for it, it's a great thing for jobs in the community.)
I was not as familiar with Costco's network, and found this article that does a pretty good job of laying out some basic facts:
http://distributioncenterjobs.net/dc/costco-distribution-center-jobs/Some details I found interesting:
- "each retail store employs more people than a Depot" (which makes sense given the size of the stores, but I never would have guessed that)
- Costco only has 12 DCs in the US
- "a level of employee satisfaction well above average, and the same anonymous feedback reveals that 90% “approve of” CEO"
- Average wage for a Power Equipment Operator is $13.07 per hour, with reports varying from a low of $13 to a high of $14 per hour.
- Average wage for a Order Picker is $11.17 per hour, with reports varying from a low of $11 to a high of $13 per hour.
So what does this mean for Tulsa, and what could be realistically expected? I few conclusions:
- We were lucky to get the Macy's DC. It will be here for quite a while and provide good jobs.
- Additional Macy's stores are fine, but not as attractive as getting their DC.
- Given the distribution network, a Costco DC is probably not in the cards for us.
- But, given the employment opportunities, etc, getting one or two (or more) Costco stores in OK would be very beneficial (much better than additional Macy's stores), and is possible as well.
And again, I don't care who takes credit.