The retailer will construct the distribution centre at the DP World London Gateway Port, which it expects to open in 2029.
Tesco said that investment is part of its “continued commitment” to ensuring that its distribution network is fit for the future.
The new distribution centre has been designed as a modern and energy-efficient site, equipped with new technology that will support Tesco’s growth. The site is also expected to achieve BREEAM Outstanding certification, a measure of sustainable building practices.
The project is being conducted in collaboration with logistics partner Witron, which will help Tesco “bolster its network capacity”.
Andrew Woolfenden, Tesco UK distribution and fulfilment director, said that the retailer’s distribution network plays a “vital” role in ensuring that customers receive products at the right place, time and condition.
“As demand grows across our store network, we’re excited to partner with Witron and DP World to develop a distribution centre that leverages the latest technology, enhancing our supply chain and supporting our decarbonisation goals,” continued Woolfenden.
“By locating at London Gateway, we can also take full advantage of the seaport and rail infrastructure.”
Helmut Prieschenk, CEO at Witron, added: “It’s an honour and pleasure for us to be part of this outstanding logistics initiative, which represents the introduction of more intelligent logistics production. With the latest technology and machinery, once fully operational, this represents a large-scale project for dry grocery distribution.
“In terms of end-to-end integration this is a lighthouse project for Witron – which ensures premium store service, an ergonomic, safe and sustainable environment and benefits the whole value chain.”
According to Kantar data, Tesco is the largest grocery retailer in Britain by market share, possessing a 28.1% share as of 15 June 2025.
In related news, activists stormed the stage at Tesco’s AGM on 12 June calling on the retailer to sever ties with meat processor Cranswick.
The protestors came from Animal Justice Project, the same organisation that uncovered widespread animal cruelty at a Cranswick owned farm in Lincolnshire last year.
