The integration of Penguin Random House took a big physical step forward Thursday afternoon with the news that the company will close two of its four U.S. warehouses by June 2015. In a memo, CEO Markus Dohle and COO Madeline McIntosh informed PRH employees that it will close the Pittston, Pa. and Kirkwood, N.Y. facilities and consolidate fulfillment for Penguin, Random House, DK, and the company’s client publishers into the Westminster, Md. and Crawfordsville, Ind. locations.
The memo noted that the creation of a more nimble supply chain is crucial to supporting the sale of print books and to do that PRH needs to develop a more efficient warehouse network. According to the memo, PRH will make “significant investments in people and resources” in the coming years at the two centers, creating 2 million square feet of warehouse capacity. “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. Our goal is threefold: to increase our competitive advantage in the marketplace, to grow the profitability of our titles for our retailers, and to bring better service to our authors than ever before,” the memo said.
No changes in PRH’s current fulfillment practices are expected until a year from now when the company will begin phasing in the combined shipping process. There was no word on how many jobs will be affected by the closings; a spokesperson said some employees will be offered the chance to move to the surviving warehouses.
The consolidation of warehouses has been expected since the merger was first announced. Both centers to be closed had been Penguin facilities.
