In the most physical manifestation of the company's merger, Penguin Random House is consolidating its warehouse network and by June 2015 will close Penguin's U.S. warehouses, in Kirkwood, N.Y., and Pittston, Pa. All U.S. fulfillment operations will be bought together in Random House's warehouses in Westminster, Md., and Crawfordsville, Ind., which will be expanded. The company will also move support and distribution offices in Pearson's Cranbury and Old Tappan, N.J., and Penguin's inside sales department.
There will be no changes for the next year, but in February 2015, the moves will start and are expected to be completed by mid-year.
In a memo to staff, CEO Markus Dohle and president and COO Madeline McIntosh said that "since the first days of the merger, we have been working to assess the many complex logistical and financial factors essential to that supply chain," leading to "difficult, yet necessary, decisions" about the warehouse network. As a result of the changes, however, "We will be able to provide better, more efficient service than either Penguin or Random House was able to offer on its own in the past. With additional significant investments in people and resources in the coming years, the two remaining facilities will expand to a combined, industry-leading capacity of two-million square feet. All our imprints and clients will now benefit from weekly new title releases with tightly-executed laydowns, daily backorder releases, a powerful international transit program, seasonal expedited transit for independent bookstores, and dozens of other unique capabilities customized to meet the needs of our diverse global account base."
Dohle and McIntosh noted, too, that "we at Penguin Random House believe in the future of print books. We distribute an average of two million print copies every day, and we project massive, sustained physical demand in the years ahead. Our company's support for print retailers is crucial to our mutual success today, and it must also increase in the future. One of the most vital components of that support will be a rapid, robust, and nimble physical supply chain."
