Rami Levy Chain Stores Hashikma Marketing 2006 Ltd. (TASE:RMLI) is launching its logistics center in the Tel Aviv Shalom Tower today in cooperation with Fabric (formerly CommonSense Robotics). The 1,800-square meter center, an underground space located in the tower's parking lot, has three robot sorting departments: dry goods, refrigerators, and frozen goods.
The new center is the first of twelve that Rami Levy plans to deploy in cities by July 2021. The current center is capable of delivering 350-400 orders daily. Starting in January, Rami Levy promises to use it to deliver orders in just two hours in various parts of Tel Aviv.
For the sake of comparison, the chain currently fills 5,000-6,000 orders daily. Rami Levy says that online purchases already account for 7% of turnover.
Two main sorting methods are used around the world: manual sorting, which is relatively costly in work hours, and huge automated centers, which require enormous investments and are located outside population centers.
Fabric's unique model is based on centers with relatively low construction costs and located in city centers. Employees of Fabric, not Rami Levy, operate the logistics centers.
Rami Levy has signed an exclusive five-year agreement with Fabric for the food sector in Israel. In effect, the agreement makes Fabric a partner in Rami Levy's profits. These centers are being built with no investment from Rami Levy; the chain is paying Fabric an advance with every center built against securities that are later deducted from the payment for the activity. Fabric is paid a percentage of turnover. Rami Levy says that this model "is cheaper and more efficient that what our competitors are doing,"
This is the second center built by Fabric in Israel; it built the first one together with the Super-Pharm chain in Holon on a site half the size of the new center. In accordance with Super-Pharm's needs, the first center does not include refrigerated products, which means that the center can fill as many as 500 orders a day.
Published by Globes, Israel business news - en.globes.co.il - on December 18, 2019
© Copyright of Globes Publisher Itonut (1983) Ltd. 2019