Lumber Liquidators plans new distribution center in Henrico County

Lumber Liquidators, a Toano-based specialty retailer of hardwood flooring, announced Wednesday that it has reached an agreement to purchase 110 acres of undeveloped land in the White Oak Technology Park in Henrico County for a 1-million-square foot distribution center.

The deal represents the next phase in a multi-year supply chain initiative that also includes leasing of a new West Coast distribution center in Pomona, Calif.

The company currently leases about 750,000 square feet of distribution space in four buildings in Hampton. Those leases generally expire before the end of 2014, and these locations would be consolidated into the new Henrico facility when it is completed. 

Lumber Liquidators said in a press release that it expects to spend $42 million to $46 million, including $5 million for the land, in building the new facility. It should be complete by the third quarter of 2014.
The new facility also will require about  $4 million in equipment, computer hardware and software.  The company expects to fund all expenditures using existing cash and operating cash flow.
 

The new center should bring significant increases in operational efficiency and unit flow, along with lower transportation and occupancy costs. These improvements are expected to benefit the company’s operating margin and strengthen the availability of product to its stores.

Lumber Liquidators' agreement to lease a 500,000-square-foot distribution center in Pomona, should begin by this November, with full implementation planned for the first quarter of 2014.  The Southern California distribution center will enable the company to strengthen the availability of its entire product assortment, officials said, allowing customers shopping in its Western U.S. stores more flexibility in the timing of their flooring projects. 

The company estimates costs associated with the opening of the Californian center to be $300,000 to $500,000 in the third quarter of 2013 and about $1 million to $1.5 million in the fourth quarter.

Robert M. Lynch, president and CEO said in a statement, “We are excited to take these next steps in our multi-year initiative to optimize our supply chain as our team remains committed to strengthening our value proposition and continuously improving our operations.  The consolidation of our East Coast distribution facilities into a new, larger location and the opening of a West Coast distribution center will ensure we can support the tremendous growth of our business and improve service to our expanding customer base.’’

Lumber Liquidators has more than 350 locations and is North America's largest specialty retailer of hardwood flooring.  Their stores offer more than 340 flooring varieties, including solid and engineered hardwood, bamboo, cork, laminate and resilient vinyl.