Logistics problems at Action inhibit discounter's growth. Last autumn, the opening of 20 shops had to be postponed. Several shops now have empty shelves due to 'hiccups in the supply chain'.
That is what Quote writes, basing the magazine on sources around the discounter. These state that the company is growing faster than it can handle. Due to distribution problems, Action opened 230 shops last year, instead of the planned 250 branches.
Generous dividend payment
Insider criticism focuses in particular on the dividends Action paid out despite operational pressures. Action owner 3i paid itself 2 billion euros in dividends. An insider told Quote: "To get the operation back on track, 3i could have invested more in Action, but instead they are extracting an insane dividend. This has put unnecessary pressure on the entire organisation."
Action acknowledges pressure on supply chain
A magazine's tour of several Action stores shows that existing shops are also facing distribution problems. Numerous shelves of the chain were found empty. Action acknowledges the problems, caused by exponential growth in shops and geography. This puts a lot of pressure on the supply chain, a spokeswoman told Belgian newspaper De Tijd. "The number of new shops grew so fast that it started to get tight in terms of logistics."
New distribution centres
In the coming period, Action is pushing to expand its logistics capacity. This year, the retailer will open a distribution centre in Poland. Two more will follow in 2020. "We have accelerated. We want to be ahead of shop openings with our distribution centres."
