Client:

One of North America’s largest Ferroalloys providers

Business Goal:

Efficient, JIT material movement for delivery from port to warehouse and warehouse to customer; competitive costs to ensure competitive sales pricing and to optimize margin.

Medima is the exclusive North American agent for global suppliers of various ferroalloys. As agent, Medima procures and imports material (domestically and from overseas), and fulfills orders for raw materials from multiple steel-making customers throughout North America. Medima began operating in March of 2008, and did not have the expertise (or the manpower) to focus on negotiating cost efficient rates for trucking from port to warehouse, or from warehouse to end user.  At the onset, lower volumes equaled higher pricing – Medima had no “buying power”. Rapid growth ensued, but they continued to pay “rack rates” for trucking, which resulted in a general overpayment for services. By end of December 2008, they were on pace to spend a considerable sum on trucking alone, based on the rates being charged. Medima knew they were spending too much money on freight, but did not have internal resources to devote to the re-negotiation project. At the same time, the carriers they were using did specialize in bulk moves, and did provide exceptional service for the JIT nature of the customer orders.

Challenges:

Reducing freight costs and ensuring continued premium service to customers.

Willson-Green was contacted for solution due to greater and more urgent need for freight expertise. A system was set up where Willson-Green provides 24/7 assistance to Medima for negotiation of freight rates, scheduling of trucks and continued guarantee of premium service. Willson Green’s team servicing Medima has many years of freight expertise, and had strong pre-existing relationships in some of Medima’s existing geographic lanes. As Medima has continued to grow, Willson-Green has assisted them in developing new lanes and cutting overall freight costs by an average of 19%. Additionally one full time person in the Medima office is now free from moving freight allowing them to prepare competitive quotes on RFP’s, which has resulted in some very large contracts awarded to Medima (because they were able to build accurate costs into their proposed sale prices). The Willson-Green team serves as an integral extension of Medima, and has allowed them to continue to grow at a very aggressive pace.

The Result:

Medima is able to focus on their core competency, and the business is now on pace, after one year, to grows sales considerably for 2009. Had they not had a strong partnership with Willson-Green to cut costs and utilize them for freight coordination on a day-to-day basis, Medima would not have been able to remain as competitive in the ferroalloys marketplace, and growth would have been much slower and more painful.

Donna Wyzykowski

Medima Metals LLC
www.medimametals.com