18 May 2017

X5 strengthens Ural logistics infrastructure

Perm, 18 May 2017 – X5 Retail Group, a leading Russian food retailer, announces the development of its Urals logistics infrastructure with the opening of a distribution centre (DC) in Perm.

The logistics facility of over 23,500 sq m will supply Pyaterochka stores in the Perm Region (currently more than 280 stores). Featuring five storage zones, each with a specific temperature band, the facility is designed to accommodate all categories of goods. This multi-format distribution centre is a key milestone in developing X5’s logistics infrastructure in the Urals, with the aim of optimising the number of DCs while also ramping up their capacity and capabilities.

The new logistics centre will ensure the freshness and availability of goods as Pyaterochka continues its active expansion, help to cut transportation costs, and unlock new opportunities for local producers. The Perm DC will be a focal point for local producers, enabling them to increase sales and bring their products to other regions. At full capacity, the DC will be able to process and handle products from over 350 local suppliers. The share of local producers in Pyaterochka’s product mix in the Perm Region is 22%, while in some categories (like bread and bakery) it reaches as much as 90%.

The logistics facility has increased the number of jobs provided by the Pyaterochka retail chain in the Perm Region by 230 to exceed 3,900 jobs.

The DC opening ceremony was attended by Deputy Prime Minister – Minister of Industry, Entrepreneurship and Trade of the Perm Region Alexey Chibisov and Pyaterochka CEO Olga Naumova. X5 Retail Group also invited managers from over 70 suppliers to take part in the ceremony. After the ceremony, the Perm DC hosted the X5 Dialogue Forum, where representatives of X5 Retail Group’s chain stores shared X5’s best practices in partnering with local suppliers and food producers. The local manufacturers received valuable advice on how to build relationships with retail chains, including information on product quality controls and requirements for transportation, storage, sales and disposal of food products set out in the Customs Union’s and X5’s relevant technical regulations.

X5 Retail Group views the development of logistics infrastructure as a strategic priority for the next few years. For the second year running, X5 leads the market by the number of DCs opened during the year. In 2015, X5 opened six new DCs with a total area of 142,000 sq m, while the area of the seven new DCs opened in 2016 totalled 212,000 sq m.