Purchasing and logistics

In 2008, Jungheinrich was faced with a steep rise in the price of steel, copper, lead, aluminium and crude oil, all of which led to higher purchasing prices. August and September saw the price of steel peak at 50 per cent above the 2007 average. Price increases were passed through to the market via escalator clauses for numerous products. The other price rises were kept below the corresponding raw materials’ price indices. Since the commodity price boom began to weaken as early as in the fourth quarter of 2008, Jungheinrich was able to place a substantial volume of orders with suppliers at significantly reduced prices in November and December.

In the 2008 reporting period, purchasing was up 5 per cent to €1,420 million compared with the preceding year (prior year: €1,348 million). Production material used merely posted a marginal gain, accounting for approximately 42 per cent of the aggregate procurement volume. Conversely, commodity sourcing increased by 20 to 30 per cent, depending on the product group.

Electronic media usage in procurement was markedly up in 2008. All of the production plants were already making use of electronic order data transmission to suppliers. Planning security was improved substantially thanks to the automated order confirmation process. A larger number of small orders was placed in order to reduce inventory. Concurrently, increased use was made of the option to place orders electronically via internal catalogues, simplifying order processing considerably. The manufacturing plants‘ security of supply was improved substantially in 2008 once again. This development is reflected in supplier evaluations, which gave supply reliability and quality issues the best ratings ever.

The Jungheinrich Group made large-scale investments in 2008. Negotiations were conducted successfully for projects including those at the Hamburg and Norderstedt sites and for the construction of the Landsberg factory since purchasing was involved from the beginning. Furthermore, purchasing played an active role in capex activity relating to IT infrastructure and additional projects. Besides being implemented on schedule, projects were completed without exhausting budgets.

Jungheinrich stepped up direct supplies to customers in Central Europe. Moreover, justice was also done to the trend towards global business expansion in logistics by increasing both overseas and Eastern European freight traffic. Cost and quality-conscious standardization contributed to improving distribution efficiency and quality.