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February 7, 2014

Penguin Random House announces closure of the Kirkwood and Pittston Warehouses

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The Kirkwood warehouse near Binghamton in upstate New York.

The Kirkwood warehouse near Binghamton in upstate New York.

A memo yesterday from Markus Dohle, CEO, Penguin Random House, and Madeline McIntosh, U.S. President and Chief Operating Officer announced that the Penguin warehouses in Kirkwood, New York and Pittston, Pennsylvania will close a year from now, signaling a major step in the Penguin Random House merger.

According to the memo, the closure of the two facilities will begin in February 2015 and be complete by June 2015. The operations at the two Penguin warehouses will move to the Random House warehouses located in Westminster, Maryland and Crawfordsville, Indiana.

The memo also explains how PRH executives came to this decision:

Since completing the merger of Penguin and Random House last July 1 the newly formed company has undertaken an extensive operational review of its existing distribution facilities.  An assessment of dozens of factors, such as processing capacity and the impact of geographic locations on delivery speed and freight costs,  concluded that with consolidated and reconfigured warehouse operations Penguin Random House can offer quicker replenishment and significant improvement in its service levels for all its titles from its Maryland and Indiana facilities.

An article by Jon Harris, a business reporter for the Press & Sun Bulletin described how heartbreaking it was for employees at the Kirkwood warehouse to learn the news on Thursday:

Larry Butler, of Binghamton, is a forklift operator at the Kirkwood facility, where he has been working for almost 20 years. At 2:30 p.m. Thursday, Butler said employees were called into a room with 300 chairs set up. A corporate statement was then read to employees, informing them the warehouse would close in 2015.

“Everyone was kind of in shock,” said Butler, 53. “A lot of people were crying.”

Dohle and McIntosh addressed the loss of jobs in the memo:

“The impact on our colleagues who will be leaving because of this decision is extremely painful and difficult.  Regrettably, it is just not logistically or financially feasible to integrate the Kirkwood and Pittston facilities. Expanding our fulfillment capabilities elsewhere does not lessen our concern for those employees who will be affected by next year’s closings.  We are extremely grateful for their many extensive contributions to Penguin’s success, and we will be discussing with them the effects of the consolidation, including transitional and post-closing support to help them through this time.”

According to Publishers Weekly, “a spokesperson said some employees will be offered the chance to move to the surviving warehouses.”

 

Claire Kelley is a the former Director of Library and Academic Marketing.

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