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Home Shopping Network is moving one of its Virginia distribution centers to Tennessee in a switch that will cost about 200 people their jobs.
The warehouse being closed is an 18-year-old facility the company owns in Salem, Va. It's being replaced by one almost twice as large about 150 miles away in Piney Flats, Tenn. About half the 450 Salem employees will be transferred to HSN's jewelry distribution and call center, which employs 750 in nearby Roanoke. The rest of the Salem workers face layoffs.
"We hope that by providing our employees with advance notice well above and beyond what is required by law, it will give them more time to review their options and make plans for the future," said Joy Perkins, senior vice president for fulfillment of HSN, which is offering outplacement services.
HSN's rebound last year and projected faster growth caught the company with customer service facilities smaller than required. Customer calls were not being answered quickly enough and support facilities were at capacity. Barry Diller, chairman and chief executive of parent InterActiveCorp, ordered an upgrade.
The chain shifted from the U.S. Postal Service to UPS, which shaved two days off order delivery. The company also achieved a 20 percent improvement in orders filled the same day. The rate of abandoned calls dropped from 8 percent to the "low single digits," said Mark Ethier, executive vice president of operations.
"We're operating with the same number of people. We're just executing better and smarter," Ethier said.
Company officials said they decided to move the distribution center to Tennessee because they could not find a big enough facility that would be available soon enough in Virginia.
HSN is moving into a 1-million square foot Tennessee warehouse that was vacated by Fingerhut Inc., a mail-order retailer, 18 months ago. The building can be expanded to 1.8-million square feet. The relocation should be completed this fall.
- Mark Albright can be reached at albright@sptimes.com or 727 893-8252.