As a result of realignment efforts, Indianapolis-based hhgregg Inc. (NYSE: HGG) says it is consolidating part of its supply chain, which is expected to affect 40 Indianapolis distribution center employees. Ryder System Inc. (NYSE: R) is partnering with the company to manage a new distribution facility in the Greater Cincinnati area.
The Hebron, Kentucky logistics hub will consolidate work from centers in Chicago and Indianapolis. hhgregg says it will maintain a local delivery center presence in the two markets, however. Displaced employees will have an opportunity to interview with Ryder and be connected with work-placement assistance, according a statement. hhgregg says it will "make every effort" to place workers affected by the decision somewhere within the company or Ryder.
The company says it continues to "investigate ways to improve operations designed to successfully navigate the highly competitive retail environment," which includes restructuring its current Midwest distribution network. Indeed, the company has suffered through a rough stretch. Its most recent annual earnings report detailed a nearly $55 million loss for the 2015 fiscal year. The company recorded a $133 million loss in fiscal 2014.
hhgregg says the move is in-line with a larger strategy that also includes expanding the footprint of its high-end Fine|Lines showrooms program, strengthen its online and call center experience for customers. The company says 24 new positions will be added, most of which serving in "customer-forward functions" in the Indianapolis headquarters.