Macy’s to invest $584 million in new fulfillment center

Macy’s, Inc. is investing in its digital future. 

The department store retailer said it plans to open a new fulfillment center in China Grove, N.C., in 2024 to meet the growing demands of its omnichannel business. Macy’s will invest approximately $584 million in the 1.4 million-sq.-ft. facility, which will feature automated direct-to-consumer fulfillment capacity and employ nearly 2,800 workers when fully operational.

Macy’s has been expanding its digital capabilities. The company’s digital sales rose 12% in its fourth quarter over last year, with e-commerce accounting for 39% of net sales.

“This state-of-the-art facility is a significant milestone for Macy’s, Inc. as we invest in strengthening our omnichannel ecosystem,” said Dennis Mullahy, Macy’s chief supply chain officer. “It will support growth of our business as a leading omnichannel retailer.”

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When fully operational, the new center will account for nearly 30% of Macy’s, Inc.'s digital supply chain capacity and serve customers nationwide. The facility will be equipped with new automation technology to increase capacity and productivity to help drive profitable digital sales growth.  

The new automation includes an advanced goods-to-person and pocket sorter system that will help modernize the retailer’s supply chain by moving merchandise with greater speed and accuracy.

As previously announced, Macy's plans to expand operations from its current Houston distribution center into a modern, new facility in Tomball, Texas, as part of its Polaris strategy. The nearly one-million-sq.-ft. distribution facility, located at 14000 Boudreaux Road, will be established in a new industrial development alongside Lovett Industrial and Clarion Partners.

The facility will be completed in mid-2023 and will continue to support stores in the region as well as provide online fulfillment during peak season for furniture, bedding and toys with opportunities. Additionally, Macy’s, has recently invested in automated technology in the existing Portland, Tenn., and Martinsburg, W.V., distribution centers to increase speed and capacity to support the growth of the retailer’s digital business.