XPO Plans Doubling of Hubs to Match E-Commerce Boom

September 12, 2017 by Dale Buss, @DaleDBuss

XPO Logistics Inc. plans to nearly double its so-called last-mile facilities to 85 service hubs by late next year, reflecting efforts to service the exploding U.S. e-commerce sector.

The hubs are used to deliver large and bulky objects such as appliances to households and other customers, items often hauled by semi-tractor trailer combos that would be too large to be delivered by a package delivery service.

The company makes 13 million home and commercial deliveries each year, with the majority including installation and assembly of appliances, large electronics, furniture and other hard-to-handle items.

“Now we’re making it even faster and more cost-effective to transport goods direct to homes,” said Troy Cooper, chief operating officer of XPO Logistics.

The expansion already is underway and will position the Greenwich, Conn.-based company’s so-called last-mile footprint within about 90 percent of the U.S. population.

XPO expects to open its next eight hubs in Birmingham, Ala.; Buffalo, N.Y.; Jacksonville, Fla.; Long Island, N.Y.; Los Angeles; Milwaukee; Tulsa, Okla.; and Washington, D.C. It said teams at each new facility will perform inspections, repairs, pre-assemblies and other value-added services in preparation for delivery.

Consumers increasingly are buying such goods online, adding to the rapid growth of e-commerce supply chains, XPO noted.

The National Retail Federation projects that growth of online and other non-store sales in the U.S. will increase by between 8 and 12 percent this year, compared with overall retail industry sales that will grow between 3.7 percent and 4.2 percent, excluding automobiles, gas stations and restaurants.

“It is clear that online sales will continue to expand and provide growth for the retail industry,” Matthew Shay, chief executive of the National Retail Federation, said in the trade group’s annual forecast.

Virtually every major retailer now sells online and thatmany of those sales will be made by discount stores, department stores and other traditional retailers,” he said.

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