Forging an important link to its national tire distribution supply chain, American Tire Distributors (ATD) celebrated the grand opening of its Poconos Mixing Warehouse Nov. 7, positioned near Interstate 80 in Blakeslee, Pennsylvania.
The massive, new $70 million facility measures one million sq. ft. in size and includes 125 dock doors, 200 trailer parking spots and the capacity to hold close to one million tires when at full capacity. The space is designed to receive more than 2.5 million tires a year from more than 3,500 imported containers. The warehouse will hold more than 1,400 SKUs from all of ATD’s proprietary brands and imported brands, including Hercules, Ironman and Dynatrac.
Acting as a central “hub” in a hub-and-spoke distribution model, the new facility will supply tires to 40 ATD distribution centers across the northeast and as far west as Ohio.
According to ATD Senior Vice President of Supply Chain Mark Chandler in his remarks, the site was selected due to its close proximity to New York and New Jersey ports of entry, in addition to being well located near one of the most densely populated areas of the United States.
In an interview following the ribbon cutting, ATD President and CEO Stuart Schuette explained the value of the new facility for ATD moving forward.
“These mixing warehouses really help us to solve what has been a historic industry issue, which is fill rates and then assortment, so we intend to use these,” says Schuette. “So with this capacity, we can extend the tail of all those miscellaneous SKUs that exist out there that customers look for, and we can do it in a very strategic and fast-fulfillment way. And it also allows us, frankly, to be [stronger] with how we distribute into the marketplace because we can actually take some inventory one level back in the network and [do] rapid replenishment down to the nodes and a hub-and-spoke method, so it drives efficiency for the business, as well with higher fill rates. You know, our fill rates in the industry tend to be around 85% same day and 95% next day; it’s a big deal. We’d like to actually get those into the nineties same day, and then higher than that as a goal – in the high nineties next day. We feel like we lead the industry and fulfillment rates today. We actually want to get one step better with that. We know that in an industry like this, you have to continue to reinvent and improve yourself to stay ahead of the curve.”
Currently at 15% capacity (150,000 tires), the facility will begin shipments Dec. 3 and is expected to be at full capacity in February 2019.
General Manager Jennifer Green will lead the operations at the facility. Though new to the tire industry, Green has a strong track record overseeing operations and logistics for a number of national luxury retailers.
According to the company, the Pocono Mixing Warehouse will receive and ship more than 2.5 million tires per year, along with wheels, tools and other automotive supplies. The facility will also be home to ATD’s sixth warranty adjustment center. Schuette said the facility will focus on primarily passenger and light truck tire inventory, but they will also hold a limited inventory of OTR and ag products.
Additional ATD mixing warehouse locations include California and Dallas.
“This is a proud moment here for the company,” Schuette said. “It’s a big day for the business. It’s another million square foot facility, and they’re as good as they get. For our people and for our customers, these are big moments.”
Recapitalization is ‘On Track’
When asked, Schuette said the schedule for ATD’s Chapter 11 recapitalization is moving forward smoothly and the timeline “is completely on track.”
“Our goal is to exit (the process) by the end of the year, and we’re very pleased with the progress that we’ve been making,” he said. “We’re thrilled to get to the other side of this and continue to move on. So this is going to provide us with a lot of flexibility. It’s a really good outcome for us.”