TK Maxx has agreed to sign a €143 million contract renewal for a further five years with DHL Exel Supply Chain. The retailer offers famous designer brands at up to 60 percent lower prices. A subsidiary of the US-based TJX Companies Inc., TK Maxx has stated that this is the largest and longest contract it has ever signed.
The contract extends TK Maxx’s activities with DHL’s specialist Department Stores and Fashion team beyond its existing operations into a partnership that will support the retailer’s key growth strategy in the UK and Europe.
Alan Porte, senior vice president, distribution services at TK Maxx explains: ‘This is the biggest and longest contract TK Maxx has ever signed. The decision was made to enable us to guarantee a reliable partner with specialist industry knowledge to manage the transition of our network into a new and improved supply chain, where product flows better and quicker into stores.’
Paul Richardson, managing director at DHL’s department stores and fashion UK and Europe adds: ‘TK Maxx has a unique business model, which relies on the flow of a huge quantity of different brands and labels to stores on a daily basis. DHL continues to work with its partner of 12 years to develop transport, warehouse and network solutions that will meet current needs and grow with the company. The UK Fashion Network is designed to do just that with our retail customers, and it has formed the backbone of our newly extended operations with TK Maxx. DHL’s European Fashion Network is set to provide the same support for expansion plans in Germany by fulfilling distribution to new stores set to open in the coming weeks.’
The ‘green’ challenge has played a fundamental role in the contract, which contains a specific clause stipulating both companies must work together to achieve key environmental and social responsibility goals. It is claimed that the two companies will be working in partnership to deliver an efficient operation, whilst reducing vehicle movement, fuel consumption and carbon emissions.
‘The fashion industry is now aware of the consumer’s need for retailers to act responsibly and we take this very seriously. The new clause makes it clear that both DHL and TK Maxx are committed to working toward reducing the supply chain’s impact on the environment and continually evaluating their social responsibility standards,’ continues Alan Porte.