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Chewy (NYSE:CHWY) to Boost Savings with New Automation Hubs

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Chewy intends to expand the number of its automated fulfillment centers this year in an effort to reduce costs and improve productivity.

Chewy (NYSE:CHWY) has plans to open more automated fulfillment centers over the next 15 months, The Wall Street Journal reported on Tuesday. The move is expected to help cut down on expenses, save time spent on tracking and packaging products, and thereby improve efficiency.

Chewy is an online retailer of pet food, pet supplies, prescriptions, and other pet-related products.

The corporation hopes to increase storage with the opening of these hubs and “repurpose some of that planned spending.”

Since 2020, Chewy has opened three fulfillment centers. In certain instances, Chewy has completely stopped its employees from manually packing boxes. Overall, the company anticipates labor productivity to improve by 50%, fixed and variable costs per unit to decline by 30%, and a 25% higher capacity per square foot, the report said.

Is CHWY a Buy Stock?

Analysts are cautiously optimistic about Chewy at present. CHWY has a Moderate Buy consensus rating based on nine Buy and five Hold recommendations. The average stock price target of $47.23 implies 33.2% upside potential from the current level.


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