Twice a week a container ship from Samskip calls on the the main plant of Ekornes in Sykkylven, close to Ålesund Norway. The destination is Rotterdam, where containers from Ekornes are loaded onto trucks and carried to furniture group’s new logistic hub for distribution to continental Europe. The hub is scarcely fifty kilometres from the port.
The change in distribution, which also encompasses fewer smaller hubs in Europe – can provide savings “in the order of” NOK 10 million (EUR 1 = NOK 9) according to Ekornes.
The sea volume represents 10 to 11 fewer trucks per week from the main plant to Europe. The energy and CO2 reduction represents a saving of about 40 %.
– It must be possible use ships for export, was the first thought of Stian Østrem when he joined Ekornes Group in 2014. A project group analysed all cargo flows to, withing and out from the company.
In 2014 Ekornes had one ship call per week to its plant in addition to cargo sent via the Port of Ålesund. Most of the cargoes to Europe was sent by truck.
Now, the goal is that 70 percent of the cargo to Continental Europe should go by sea, the rest by truck.
Ekornes has, to a large extent, reached this goal, and by now they are busy fine-tuning the distribution, among other things to ensure reliable supplies even if bad weather causes delay. However, the big picture is quite clear – shipping by sea is profitable and works well.
A key target of the reorganization is that customers should get the Ekornes furniture at least as fast as before. With only one call per week this meant at least a week between each time Ekornes delivers in Europe. Now, with two calls per week there is only three to four between each delivery.
The shift to sea is the main reason why Ekornes believes there it is possible to cut transport costs to continental Europe with around NOK 10 million. To reach this goal Ekornes will reduce the number of warehouses in Europe from five to two. The reduction will be completed within the year.
The goal for the next step is to use more direct distribution. Several customers are large enough for a full container loads from the factory instead of the furniture being repacked and resent from the warehouse at Rotterdam.
It is better to stuff the container at the factory to be transported directly from the ship to the shop.
Østrem says that there is potential extra savings of NOK 2-3 million per year on the raw material and part suppliers if they can be shipped by sea via Rotterdam to the plant in Sykkylven. Each supplier on their own do not have sufficient volumes for sea transport, but with coordination the ships become an appropriate opti
Ekornes is open to sharing their logistic solution with other businesses in the region. The quay at the Ekornes plant is owned and operated by Ekornes and they would like to increase their volumes.
