4/1/2015
HEADLINES
PERSPECTIVE: NFDA Sees Würth’s
Logistics in Action
In 1999, there was a 302-acre wooded property on the edge of Bad Mergentheim, Germany. By 2014, Würth Industrie Service GmbH & Co. KG was operating 551,650 sq ft of logistics space and 8.1 miles of conveyor belts on the property, processing 7,800 tons of product per month there.
The relatively-new Würth Group company was based on logistics from day one. Each of the current 1,367 employees spends one Saturday a year working in logistics. That is to emphasize logistics to all employees. “Here is the value we generate,” marketing director Martin Jauss explained. “And this way administrative people know what to do. They know what to talk about with a customer.”
Jauss gave the National Fastener Distributors Association a tour the day before Fastener Fair Stuttgart opened.
Jauss explained that Würth Industrie is an example of an advantage the privately-held, Würth family business has. The Würth Group decided the idea for a company supplying c-parts for assembly technology was good, and Würth was able to invest “out of our own pockets.”
We can grow without limits, Jauss said.
Würth Industrie Service is one of more than 400 Würth Group companies in 80 countries with 66,044 employees.
Jauss said the “small entities can react to market and customer needs.”
Together the Würth companies topped the EUR 10 billion (US$10.97b) sales mark for 2014. Künzelsau, Germany-based Würth Group sales rose from EUR 9.75 billion for 2013 to EUR 10.12 billion in 2014.
Würth Industrie’s portion of the 2014 Würth Group sales was EUR 387 million (US$424.5m).
“We buy screws and we sell screws. That’s what we do.”
But starting with fasteners has led into other products: Gloves, hinges, pliers, toilet paper, work benches, chemicals, electrical tools, feathers or “whatever the customer defines as ‘c-parts.’”
“If one customer asks for it, other customers are potential buyers,” Jauss observed.
Every month Würth Industrie handles about 1,000 new products. There are only two limits to what Würth Industrie will sell, Jauss explained: “If it doesn’t fit on a pallet or doesn’t make money.”
One customer wanted digital cameras. “We don’t need expertise in digital cameras,” Jauss explained. “Customers give us the specifications.”
• A key factor is Würth’s European growth is that Europe has become one trading zone – with the exception of Switzerland and Norway. For centuries the multiple countries of Europe had trade borders and barriers. “There is no barrier to stop product anymore,” Jauss declared. “We can ship everything from here – because it is possible.”
Würth Industrie Service operates out of its own industrial park in Bad Mergentheim. It has 17 European sales branches.
• It is a computer operation. “Computers calculate the peaks and valleys in demand and we reorganize immediately,” Jauss said. “Product needs to be at the customer when he needs it.”
That includes determining “peaks of demand.” Using its own software, the Würth Industrie computers “look into the future.”
• “We want to be innovative,” Jauss declared. Würth Industrie designed front-flap Kanban drawers to make stocking and using more efficient and reduce shelf space. The 1,250,000 bins now is use can be cleaned to be ready for clean products and that results in cost savings. Bin barcodes are scanned for automatic transmission to speed order processing. That information includes not just quantities, but location, traceability and customer information. Innovation also includes “intelligent shelves” that monitor stock.
But Würth is more than just computers. “It is important that a customer is willing to learn from us,” Jauss explained. There is an actual cost difference between deliveries one time per week and a 24-hour rush order.
• Würth is transparent with quality standards worldwide.
“We’re an open book – very, very transparent,” Jauss declares. The customer can see how Würth saves them money by reducing the supplier base and reducing the order price.
WIS’ 20,000 customers are welcome to visit.
“Customers become bound to us,” Jauss said. Indeed, WIS has lost very few customers other than to bankruptcy, Jauss added.
• “We want to find errors” and correct them before reaching the customer, Jauss said of Würth’s philosophy. WIS has an internal goal of a 1.2% error rate and only a .005% return rate.
Beyond the obvious automation throughout the facilities, “everything is checked by a person,” Jauss pointed out to NFDA members on the tour. Quality is assured through trained people who “sign their names.”
Würth Industrie developed its own testing lab for fasteners. It provides “clear documentation and specifications.”
• The majority of employees’ compensation is based on “results,” Jauss said. “There is not such a thing as a salary.”
There are two daily shifts for employees and the automated warehouses operate 23 hours a day.
Employees must go through “continuous training.” The key question employees must understand: “Did we create benefit for our customer?”
Another question Würth Industrie follows closely: “Did they complete the daily tasks?”
• “We measure process steps every day,” Jauss said. The data “optimizes” responses.
• WIS has room plus plans to expand in the industrial park measuring three miles long.
Bad Mergentheim is a town of 22,486 people in the German state of Baden-Württenberg. The town with a castle complex developed over 800 years is mentioned in chronicles back to 1058. In 1826, a shepherd discovered mineral springs in the area. Now Würth Industrie Service’s industrial park is Bad Mergentheim’s center of growth.
Share: