Retail giant Asda has confirmed significant operational changes that will see the delivery distribution for its popular George clothing brand's online orders outsourced to logistics specialist DHL. This strategic move, scheduled to commence in January 2027, is projected to affect around 1,200 employees currently working across three key distribution facilities.
Operational Restructuring Details
The supermarket chain, which operates under private equity ownership, has formally announced proposals to transfer all George.com distribution operations to DHL's established facility in Derby. This transition will involve relocating operations from Asda's current distribution centres located in Lymedale, Staffordshire; Brackmills, Northamptonshire; and Washington, Tyne and Wear.
Employee Transition Arrangements
Asda has provided assurances that all affected workers will have the opportunity to transfer to DHL under the proposed arrangements. The company has emphasised that these transfers will occur under TUPE regulations, which legally safeguard employees' existing pay structures, pension arrangements, and length of service continuity.
David Lepley, Asda's chief supply chain officer, commented: "This proposal directly supports the continued expansion of our George.com business as we work toward our ambition for George to become the UK's largest clothing retailer by volume."
Business Growth Context
The decision follows substantial growth for George.com in recent years, with the brand currently processing more than 16 million online orders annually. Company projections indicate the online platform will double in size by 2032, with current distribution facilities expected to reach maximum capacity within the next two years.
It's important to note that Asda's distribution centres will continue operating normally for other business functions, including supplying George products to supermarkets for in-store purchases. Workers handling distribution for other business areas at these locations will not be impacted by the changes.
Union Response and Company Rebuttal
The GMB trade union has expressed concerns about the outsourcing decision, suggesting it "paves the way for a full carve-up of the company" by private equity owners TDR Capital. This comes alongside recent reports regarding plans to eliminate 150 positions as part of an ongoing restructure at the retailer.
Nadine Houghton, GMB national officer, stated: "Hardworking families and working-class communities should not see their livelihoods put at risk due to the business decisions of a handful of private equity executives. It is time for TDR Capital to come clean and be honest about their plan for the business."
However, Asda executive chairman Allan Leighton has firmly dismissed these assertions, responding: "The suggestion that we are looking to break up the business is categorically untrue and, frankly, insulting to all our colleagues. There is only one agenda in this business – it's called the Formula for Growth and we are solely focused on that."
Implementation Timeline
The proposed operational changes are scheduled to begin in January 2027, with completion expected later that same year. This transition represents a significant shift in Asda's supply chain strategy as the company positions George.com for continued market expansion and operational efficiency in the competitive online retail landscape.
