Recovering Supply Chain Cost Efficiency Through Original Logistics Solutions: A Case in the Steel Industry

Choices of facility location and suppliers usually are important in the definition of a competitive strategy. Sometimes, however, the growth pattern of the company strongly restricts the real possibilities of choice concerning the supply chain design.The Duferco Group, operating within the steel industry, has based its recent growth on the acquisition of existing firms: Taking advantage of restructuring of the steel industry throughout Europe, the group arranged a sizable production structure under favourable market conditions. This strategic behaviour, however, led to suboptimal supply/distribution conditions. This case study illustrates how the Duferco group pursues a low-cost production strategy, trying to overcome the disadvantages of geographic dispersion through efficient organisation of logistics.