The LEGO Group is to centralise its European distribution centre (EDC) in Prague, Czech Republic, and outsource its European operation to DHL Solutions. DHL will open and begin operating its new and customised logistics centre in early 2006.
Following an analysis of its structure, the LEGO Group announced on August 31, 2005 that it plans to discontinue its five distribution facilities in Flensburg and Hohenwestedt (Germany), Billund (Denmark), Lyon and Dunkerque (France) and to concentrate its European distribution operation in Jirny, 10 km east of Prague.
The new EDC will handle distribution to LEGO customers in Europe and to LEGO distribution centres throughout the world (except North America). The project will consist of two phases: phase 1 will be a 28,000 m2 warehouse which is now under construction and will be operational by mid December; phase 2 will be the construction of a similar size building to be operational by mid March 2006. The total site will be one main logistics centre of total 56,000 m2, and will be one of DHL Solutions bigger facilities in Central Europe. In full operation, planned early 2007, the LEGO activities will occupy 51,000 m2.
The centre's activities include inbound and outbound logistics, storage and value added services such as assortment packing and customisation. The Jirny site will be one of DHL Solutions' strategic locations from where DHL offers the complete range of logistics services to the market.
The LEGO Group and DHL have signed a contract for five and a half years.
“We are convinced that we will achieve significant benefits from outsourcing and centralising our logistics operations at the DHL Solutions centre in Jirny,” said Egil Møller Nielsen, LEGO Group head of global distribution (Europe, Asia & Emerging Markets).
According to Igor Zahradnícek, managing director of DHL Solutions Czech Republic and Slovakia, there are not many European distribution centres in Prague, and certainly not many that handle such a large volume. “The scope of the LEGO contract will allow us to grow and expand our business significantly. It is our intention to operate the site in Jirny as a multi-client operation.”
