Tesco announced it will significantly expand its distribution centre network in Thailand at the British Business Embassy retail, food and drink summit last week.

Support growth in Thailand

The three 'state-of-the-art' distribution centres will help support Tesco's expansion in Thailand, where it operates under the Tesco Lotus brand. The retailer is developing a number of formats including Tesco Extra and online services and currently operates around 1,000 stores in the country. The extended distribution network will also help develop Tesco's relationships with suppliers; it currently works with 9,000 local suppliers and small and medium enterprises (SMEs).

Double the existing network

Tesco Lotus currently operates a network of three distribution centres located in Wang Noi, BangBua Thong and Sam Khok. All are located around Bangkok in the south of the country. The Wang Noi distribution centre was Tesco's first in Thailand and is a multi-temperature operation storing fresh grocery products. The temperature-controlled chamber has capacity to hold around 100,000 crates each day.

Reducing prices for customers

By operating a centralised distribution model, Tesco can lower its distribution costs in Thailand and in turn offer lower prices to shoppers. Tesco Lotus' distribution facilities also transport products to the rest of the Tesco Group helping suppliers export their products across the globe.