The logistics of steel distribution in South Africa with specific reference to a large transport operator

Abstract

This project deals with the viability of establishing a staging operation in the Alberton area which will enable Cargo Carriers Limited to improve its service in the distribution of Iscor's steel. This report discusses the logistics of the staging operation and the cost implication : a forecast is made to compare the profitability of the new operation with the existing method distribute tg i teel. Conclusions reached are: - the establishment of a staging operation will provide an improved service to Iscor at the cost of being 7 percent less profitable (in term s of return on turnover). - the cost of establishing a new depot in Alrode for the staging operation will be in the region of R5 000 000, - by shunting nnd stag in g loads o v ern ig h t In A iberton a capital saving of 27 vehicles will be achieved. T h j establishm ent of a sta g in g operation will also provide Cargo C arriers Limited with the following benefits: - improved p ro d u ctiv ity of fleet. - more flexibility of serv ice. - enough room for any fu tu re expansion of depot. - the possibility of obtaining new bu sin ess from th e larg e in d u strial companies which are located near th e new depot. Because of the operational ben efits and im proved custom er serv ice it is recommended th a t Cargo C arriers Limited pro ceed s with the establishm ent of such an operation.