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With 185 stores and a high volume of imports, the demands for logistics synergies was growing. The solution was to have one and the same supplier – PostNord.
"Our stores have no stockrooms," says Peter Bergestål, Transport Manager at Clas Ohlson.
What we have in store, is on the shelves. It keeps our warehousing costs low, but it also means we have to stock our stores every morning.To make sure everything works as it should, Clas Ohlson relies on PostNord, which has created a total solution for the Nordic region.
If you have a goods flow of around 1,000 pallets and 100 truck and trailer combinations a day – which have to operate in and out of a 77,000 square meter warehouse smoothly and at the highest level of economic and environmental capacity possible – you need logistics. Well-planned logistics.
That's how it is for retail giant Clas Ohlson, which for nearly 100 years has been selling tools, and nowadays also a wide range of neat gadgets and interior products for households. All this time, the north central Swedish town of Insjön has served as the hub and core of the company's operations. Insjön has the biggest of all the company's 185 stores, but also – most importantly – the huge central warehouse, which dispatches all goods to all stores and e-commerce customers and receives empty boxes and returned goods.
- "The more we expand, the more important it becomes to identify effective synergies to optimize our transport arrangements," says Peter Bergestål, Transport Manager at Clas Ohlson.
The solution was to hire the same supplier, PostNord, to handle both incoming and outgoing flows, which it now manages for the entire Nordic region.
- "Being able to bring the entire Nordic region under one umbrella is an enormous gain for us! It means that we can operate full loads in every direction. We handle a lot of returns, empty boxes and goods – and so these can now be carried as return loads in our hub network."
Of course, in addition to the economic gains and time savings, the synergies also help with environmental conservation, explains Peter Bergestål. And the environmental issue is extremely important to Clas Ohlson.
Another environmental initiative in logistics is that for the past couple of months all goods shipments in Norway have gone by rail.
- "As a result, we've been able to cut carbon dioxide emissions from our Norwegian services by just over 30 percent," reveals Peter Bergestål proudly.
Now "all" that remains is to come up with similar solutions in Sweden and Finland, since rail transport is by far the eco-friendliest option. A challenge worthy of the name, but one that shouldn't be totally impossible to manage, says Peter Bergestål.
The issue of more distribution centers is another nut to crack. The central warehouse facility in Insjön is beginning to reach its pain threshold in terms of size, despite wide-ranging automation and productivity improvements. For example, automatic pallet cranes prepare and sort all incoming goods overnight before the workforce arrives. They also serve the goods-pickers with deliveries, rather than the other way round.
But even so. The facility is starting to reach its capacity limit and so plans are being made for more warehouse establishments. The number of stores is steadily expanding (and as a rule no stocks are held in-store). After the Nordic region, Europe is next retail market in line for the giant Clas Ohlson store chain. This will add to the pressure for not only robust and strategically well-planned inventory management but also efficient, eco-friendly distribution systems, emphasizes Peter Bergestål, who once again highlights the benefits of having one and the same supplier for all goods. What's more, a supplier who shares the same fundamental values at Clas Ohlson in terms of both logistics as such and environmentally.
- "The collaboration with PostNord is delivering huge gains to us. We're now looking forward to further expanding our business."
Clas Ohlson's logistics flow
1. 65% of Clas Ohlson's products are sent by ship from Asia to Rotterdam or Hamburg, where they are reloaded then transported to the Port of Gothenburg.
|2. In Gothenburg, all the goods are reloaded on to trains which deliver the goods to the central warehouse in Insjön. |
|3. On arrival at Insjön, the goods are sorted by country and store location and then shipped by road to strategically placed hubs in Sweden, Norway and Finland, where the goods are distributed to the individual stores. |
|4. In Sweden and Finland, the store deliveries are transported by road, but in Norway all goods outside the Oslo region are distributed by rail to six rail hubs. From there, the goods are taken the rest of their journey by road. |
|5. Because PostNord is the sole supplier, all goods returned are taken as return loads.|