Itella has announced a change in strategy to refocus on its logistics services in Scandinavia and its road transport operations. The company claims that in this field it already has a firm foothold and the possibility to increase its market share. Itella’s stated aim is also to develop its offering in road transport in selected market areas in Europe.
As part of the new strategy Itella plans to withdraw from its air and sea freight forwarding operations as well as its service warehouses in Sweden, Norway and Denmark. In addition Itella’s internal distribution logistics in the countries is to be outsourced.
Itella stated that the plans will require significant staff reductions, estimated at 300 positions across Sweden, Norway and Denmark. The need for personnel reductions will be defined in the discussion concerning the operations, and the country-specific cooperation negotiations.
Itella expanded in the Nordic Region in 2005 as part of its internationalization strategy in logistics. However, the decline of the economy and intense competition have weakened the profitability of logistics operations in the region since the financial crisis began. As such Itella is focusing its operations on Finland, Russia and the surrounding areas. Additionally, Itella’s market share of the Scandinavian operations to undergo restructuring has been small.
“The profitability of operations in Scandinavia has not been at an adequate level and this is why we need a new strategy. Itella’s goal is to ensure the profitability of its operations in all situations over the short and long term. The changes that are being planned now are necessary to reach this goal,” said Itella’s Senior Vice President Jani Jolkkonen.
The planned renewal does not affect Itella’s logistics services in Finland, Baltics or other countries outside the scope of the changes.
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