Ulta Beauty is revolutionizing its supply chain with a shift to a Market Fulfillment Center (MFC) model, blending efficiency and adaptability. Unlike competitors that rely on large, capital-intensive facilities, Ulta is opting for a smaller, nimble network. The model includes four regional distribution centers, three market fulfillment centers, and a “fast” fulfillment center, said Erik Lopez, Chief Supply Chain Officer.
The MFC model accelerates fulfillment, keeps inventory centralized, and requires less capital investment. “It’s faster to build and gets closer [to customers],” Lopez explained.
To optimize this strategy, Ulta is retrofitting existing distribution centers with advanced automation. Following upgrades to its Greenwood, Indiana, facility, similar improvements are underway at its Dallas center, set for completion in 2025. These upgrades include warehouse execution software, which acts as the “brains” of the operation, streamlining workflows and enhancing efficiency.
The retrofits also aim to empower employees by reducing repetitive tasks and offering skill development opportunities. “We’re focusing on reducing steps and waste while being less labor-intensive,” Lopez said.
Ulta’s thoughtful approach positions the retailer to meet growing customer demands while fostering innovation within its workforce.
