Hy-Vee: About 300 people will be laid off from Urbandale fulfillment center

By: - March 10, 2020 11:51 am

Hy-Vee is limiting meat sales for customers in light of COVID-related shortages. (Photo by Linh Ta/Iowa Capital Dispatch)

Hy-Vee is laying off around 300 employees from its Urbandale fulfillment center, according to a Warn notification from Iowa Workforce Development.

About 368 people will be affected by the center’s closure. A few dozen of those people will be transferred to other positions within the company, said Tina Potthoff, spokesperson for Hy-Vee. Around 300 will be laid off.

The company announced on Friday it will permanently end filling online grocery orders at its four fulfillment centers this month.

The West Des Moines-based grocery company has fulfillment centers in Urbandale, Kansas City, Omaha and Eagan, Minn. It will move those operations back to its retail stores, said Tina Potthoff, spokesperson for Hy-Vee.

As many as 327 employees will face layoffs at the Eagan Fulfillment Center, according to bizjournals.com.

That number is even higher in Kansas City, where up to 600 people may be laid off, according to the Kansas City Star.

Employees were notified of the center’s closure on March 5. The layoff date is set for May 6.

Hy-Vee introduced online shopping to all of its stores in 2015 through its “Hy-Vee Aisles Online” program. Customers can buy groceries online and pick them up at a store or get them delivered.

A year after the launch of Hy-Vee Aisles Online, the company purchased its first fulfillment center in Urbandale, an 81,936-square-foot store at 3303 86th St. for $3.6 million, according to a Des Moines Register article from 2016. 

In 2017, Hy-Vee announced it was building three more fulfillment centers out-of-state to meet its online demands. The centers are meant to help fill and package online orders.

But due to customer demand for same-day pick up and more product variety, Potthoff said Hy-Vee is moving fulfillment operations back to its grocery stores.

“Fulfillment center operations will be transferred to our retail stores later this month – that means customers’ orders will once again be fulfilled at their local Hy-Vee store,” Potthoff said.

Order fulfillment will end at the centers the week of March 23.

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