l POSCO institutes a system that allows SME clients to share the company’s vessel for exporting goods
l Test operation conducted last year resulted in a reduction of 1.1 billion KRW in logistics costs for 42 SMEs
l The system is part of strengthening the practice of POSCO’s management philosophy “Corporate Citizenship” and grow together with clients, suppliers, and local communities
POSCO (CEO Jeong-Woo Choi) has actively stepped up to help SME clients who are having difficulties in securing vessels for exporting goods.
On grasping that its SME clients are facing difficulties in securing vessels to ship their products on time due to the small quantities, which lead to high transportation costs and deteriorated competitiveness, POSCO created a system enabling SME clients to ship their products together with POSCO products. The system is scheduled to open in January.
Once the system is in full operation, clients will be able to search and apply for available vessels in real-time online. Previously, SME clients had to request large shipping companies for the shipping schedule from time to time.
During the test operation last year, 42 SME clients shipped 56,000 tons through the system and saved approximately 1.1 billion KRW in logistics cost.
Hankum Co., Ltd., a company that processes and exports steel materials, said, “With POSCO’s logistics system, delivering products with the same level of transport quality service as POSCO in due time is possible — even at a lower price than before.” He also added, “The system also enables stable and competitive exports since the shipping can be processed periodically and can include even small quantities.”
The system is a POSCO-type Shared Growth program that aims to strengthen the competitiveness of the entire logistics value chain, such as POSCO and shipping companies, as well as SME clients. The system benefits the shipping companies as sales are increased with the additional quantities, while shipping costs are reduced since they do not have to move to other docks to fill in shortages. The system also benefits POSCO by minimizing dead freight caused when the cargo is less than the contract quantity.
POSCO plans to visit clients, inform them on how to use the system, and offer logistics solutions consulting. Also, POSCO will continue to strengthen its role as a Corporate Citizen by providing support to improve the purchasing and logistics process for SMEs.