DHL Supply Chain Improves Adidas Brazil Logistics Chain With Omnichannel and Semi-automated Distribution Center

• With an investment of R＄70 million, new facilities were built from scratch in Extrema (MG), adding innovative technologies and sustainable practices
• The new Distribution Center will be adidas' main logistics hub in Brazil, serving the areas of e-commerce, retail, and self-owned stores
• The Digitalization of logistics processes and the use of conveyors and other equipment will ensure greater scale, agility, and efficiency to the operations

DHL Supply Chain, a global leader in warehousing and distribution, and adidas, a leader in the sporting goods industry, open this month in Extrema (South of Minas Gerais State) one of the most modern Distribution Centers in Brazil. With an investment of more than R＄70 million, the new facilities were specially designed and built from scratch for this project, combining innovative technologies and sustainable practices. The new DC, with around 40 thousand m², will be adidas' main logistics hub in Brazil, serving the Company’s top three areas - e-commerce, retail, and self-owned stores - in a synergistic way and adopting a more agile, efficient and technological logistical design.

The warehouse stores 50 thousand SKUs and 5 million items, making up one of the largest sports stocks in the country (clothing, sneakers and accessories). The facilities already have the LEED certificate for sustainability, due to their good energy saving practices and waste reuse. In the coming months, a solar plant will be installed on the roof, which should generate 35% of this operation's energy consumption. This project generated 400 direct jobs in Extrema, with part of the team coming from other adidas operations.

For Gabriela Guimarães, Vice President of Retail and E-commerce at DHL Supply Chain, “The new DC brings a renewed vision to adidas' logistics design in Brazil. It captures the most favorable conditions in the region and proposes a new operational flow with a lot of logistical intelligence and onboard technology. This will enable us to provide greater agility in deliveries as well as increased reliability and efficiency. The new DC will comprise one of the most modern operations in Brazil, as we will almost completely automate three processes: cargo movement within the warehouse, sorting in e-commerce, and packaging.”

Andre Biancardini, Senior Director of Supply Chain Management at adidas Brazil, says that: “The new Distribution Center will provide us with a solid foundational platform for the company’s expected growth in the coming years. The move to Extrema brings us closer to our main customers in the region, and ensure more technology and automation, with a strong focus on sustainability.”

Innovation

adidas’ new logistics hub is now operating with four advanced technologies. The first is the Warehouse Management System (WMS), whose version is the most advanced on the market and brings advantages such as execution in the cloud, no downtime required for updates, and extended specialization and accuracy for omnichannel inventories.

The warehouse has automatic conveyors to speed up the internal movement of cargo. In addition, an automated sorting equipment separates products for shipping, and a robot - that will be used in the e-commerce area - “reads” which item is currently available and takes care of the packaging for all products. To reduce non-degradable waste, these packaging will be made almost exclusively with paper.

“Automation alone does not bring the desired results. To get there, it is necessary to have solid logistical planning, well-designed processes, and trained, experienced staff, so that the equipment can effectively provide greater scale and agility to activities. The new DC starts out with a solid operation, but we hope to evolve even further with our continuous development practices,” explains Gabriela.

Deliveries from this operation also rely on the Control Tower handled by DHL - which, in addition to supervising, generates relevant data and insights to improve business in all senses. “Based on the information gathered, our goal is to constantly review the adidas logistics ecosystem, improving our service levels and developing new projects,” concludes the Vice President of DHL Supply Chain.