Arla to centralise UK chilled supply chain with new Northamptonshire distribution centre

Arla Foods is set to centralise its entire UK chilled supply chain through a new automated distribution centre in Northamptonshire, marking a major expansion of its partnership with XPO Logistics.

The new central distribution centre (CDC), currently under development at Prologis RFI DIRFT, will handle all of Arla’s UK chilled palletised products, including cheese, butter and yogurts. XPO Logistics will project manage delivery of the dairy site and operate the facility from late 2027, when it becomes operational.

Explaining the strategic rationale behind the move, Fran Ball, SVP UK Supply Chain for Arla Foods UK, said:

Consolidating our chilled pallet operations into a single, advanced facility in Northamptonshire is a strategic leap forward for Arla.

By partnering with XPO Logistics and Prologis, we are improving the resilience of a critical part of our supply chain and making meaningful progress on reducing waste and road miles.”

Arla said the move to a single chilled hub will strengthen supply chain resilience, cut road miles and improve nationwide delivery efficiency. The temperature-controlled, highly automated facility will form the backbone of a future-ready chilled network designed to keep fresh dairy moving safely and reliably.

Investment underpins long-term UK supply chain strategy

The announcement follows a €107.7m (£90m) investment at Arla’s Lockerbie site to create a UHT and lactose-free milk centre of excellence and forms part of more than €355m of UK investment announced in 2024, underlining the cooperative’s long-term commitment to British dairy manufacturing and supply chain capability.

From an operational perspective, XPO Logistics said the new CDC will be central to maintaining service quality at scale. Dan Myers, managing director – UK and Ireland at XPO Logistics, said:

Arla stands for quality, their products are loved and trusted by every household in the UK.

This future ready CDC will play a key role in ensuring that Arla continues to deliver great products whilst improving the resilience, sustainability, and efficiency of Arla’s supply chain.”

The Northamptonshire CDC will target BREEAM Outstanding and EPC A+ ratings, supporting Arla’s sustainability ambitions while enabling a high-performance logistics operation.

Construction officially began this week, with Arla Foods, XPO Logistics and developer Prologis marking the milestone on site alongside representatives from West Northamptonshire Council.

Phil Oakley, SVP at Prologis UK, said the development would help “create long term economic value for West Northamptonshire”, supporting investment and jobs across the region.

Summing up Arla’s wider ambitions for the UK market, Bas Padberg, managing director at Arla Foods UK, added:

Today’s announcement further signals our commitment to driving change in the UK, and supporting the future of British dairy.

The UK food sector has a vital role in public health, and we’re committed to delivering nutritious, affordable dairy for more people – this is another important step forward.”