The automated picking operation used at the centre will be shut down, but Tesco confirmed that the site, which employs more than 1,500 people, will not be closing.
Workers will be considered for positions at other sites and stores or be offered redundancy packages.
A Tesco spokesman said: 'At Tesco, we have to regularly review our distribution network to ensure we can deliver the very best service to both stores and customers. Consequently, we no longer plan to operate the automated picking operation in Fenny Lock.'
He added that Tesco will support all affected staff through the difficult period ahead and will do as much as possible to find them an alternative role at the supermarket.