WZK Victoria: how to reduce transport costs by 25%
Polish company, Wałbrzyskie Zakłady Koksownicze "Victoria" S.A., exports its goods to as many as 30 countries, mainly in Europe. Organization of the logistics process in such a company is undoubtedly a huge challenge. However, it turns out that optimization can be applied even in a well-organized company.
This enterprise managed to reduce transport costs by 25%. In an interview with Damian Swoboda, Marcin Frąckiewicz, a logistics and transport expert at WZK “Victoria”, will describe how to achieve this.
ABOUT THE COMPANY
The history of Wałbrzyskie Zakłady Koksownicze “Victoria” S.A., located in Lower Silesia viovodeship in Poland, dates back to the 18th century. The core activity of the company is the production and sale of coal-based products: sulphur, tar and benzole. Victoria is a leading manufacturer of foundry coke in Poland. It also carries out special orders from the sector of foundries, metallurgy, non-ferrous metals and insulation materials, which are exported to 30 countries, mainly in Europe. It delivers its products to customers by road (dumper trailers, movable floor), rail and maritime transport.
What challenges related to logistics did you face before deciding to implement the Trans.eu Platform?
First of all, the problem was a limited access to carriers with a specialized fleet – dumpers or movable floors. Additionally, we aimed to optimize transport costs – we had the impression that the ones we incurred on some routes clearly exceeded average market rates. Another challenge was posed by the transport organization itself. As our products are distributed in 30 countries, reaching some locations was problematic. We decided to search for a tool that would make these processes easier.
What solution were you looking for?
The main requirement was access to the community of carriers. We were looking for those who not only offer a specialized fleet, but also provide high-quality services at a mutually acceptable rate. We decided on the Trans.eu Platform because we are aware that this tool leaves the competition far behind.
After getting familiar with the product, we realized that the Platform will help us organize other transport organization processes – from selecting carriers and placing an offer, through sending a transport order.
You mentioned that you had struggled to organize transport on some routes. Has anything changed?
It is no secret that the biggest problem for us was transport to countries from outside the European Union, e.g. Turkey, Russia as well as Asian countries. This process includes other customs procedures, export and import clearance. It turned out that on the Trans.eu Platform we can find quite a big number of companies providing transport services to markets outside the Union. Bulgaria and Hungary were also problematic markets for us and here too, the Platform proved to be indispensable.
With hindsight, did you manage to reduce costs of transport organization?
For sure. We are talking here about cost reduction by 10%, which, given our scale of operations, results in huge amounts of money. On some routes savings can be as high as 20-25%. Before we started our cooperation with the Platform, we did not have access to a wider range of carriers and, in result, competitiveness was lower. We also did not have the possibility to compare rates on various routes and negotiate them.
What helped you improve communication with carriers?
We mainly focus on cooperation with regular subcontractors. For this purpose, we use the Contractors module, where we have created groups of trusted subcontractors providing services on a given route. Thus, if we have an order of transport to, i.e. Turkey, we send an offer only to those companies which operate in this area. It helps us save time we used to spend on looking for a carrier. Work which was previously done by 3 people can now be handled by one.
We have been working together for so long that you must remember the previous system version, where you contacted carriers mainly via the messenger. The new Platform offers the possibility of working in an organized way with regular contractors. What solutions did your contractors accept?
It turned out that most of our carriers work on the Platform and know it very well. So they were not surprised by moving to a different form of cooperation. Time is money also for carriers – they receive matching offers from a trusted and solvent customer. Just a few clicks and they can go for loading – without wasting time on calls, manual completion of documents or texting.
All your freight offers used to be added on the exchange. Now the trend has changed and most of them are sent to your groups of carriers. What do these proportions look like?
In fact, ¾ of all the orders are sent to our regular carriers through the Contractors module. Only a few are published on the exchange.
What plans for the future does WZK Victoria have?
We focus on development, even in these difficult times – acquiring new clients and extension of our sorting plants to be more competitive on the market.
When it comes to logistical goals, we are still searching for new carriers. Hopefully, we will manage to achieve our goals thanks to the Platform.
Fingers crossed! Thank You for Your answers.
The interview was conducted with Marcin Frąckiewicz
Logistics and transport Expert, Wałbrzyskie Zakłady Koksownicze “Victoria” S.A.
