Purchasing at Jungheinrich
Purchasing and logistics
In the Jungheinrich Group, procurement is organized by product group. All sourcing needs are structured according to a groupwide product group management system that encompasses 40 main product groups. This is supplemented by 10 additional main product groups in which post-serial needs are bundled.
In 2015, the total procurement spend amounted to €1.75 billion (2014: €1.51 billion) consisting of production material (including after sales), trading goods and indirect material.
The commodity groups with the largest purchasing volume have been Batteries with €171 million (2014: €153 million); Steel Fabrications (for production), with €103 million (2014: €98 million); Facility Management with €100 million (2014: €59 million); and Warehouse Equipment, with €97 million (2014: €78 million). In 2015, the Facility Management spend included major construction projects like the corporate headquarter in Hamburg, the new training center Norderstedt as well as the restructuring of the used-equipment center in Dresden.
Purchasing controlling is a priority at Jungheinrich. The centrepiece of purchasing controlling is the purchasing cockpit in which all relevant key figures are collected. It is based on SAP-BI (Business Intelligence) and SAP-BW (Business Warehouse) and builds a bridge from strategy development to the measurement of implemented measures and results.
The core element of reporting is the change in the cost of materials, a key figure that reflects the impact of earnings on the income statement. The effects on prices of external factors such as changes in foreign exchange rates and commodities are also measured and taken into account when making purchasing-related decisions.
Jungheinrich redesigned its contract management system in order to satisfy the variety of demands placed on modern contract management in practice. This undertaking concentrated on drawing up uniform contractual standards based on modular contract procuments as well as on establishing a computerized contract creation and archiving system.
The redesign laid the groundwork for increasing the number of master agreements even more. Furthermore, computerized contract creation and the simplification of contract wording shorten processing times.
Analysis of the lithium-ion technology, Procurement market
Jungheinrich is increasingly availing itself of lithium-ion technology to supplement the conventional lead-acid traction batteries it uses. To defend and increase this competitive advantage, the purchasing organization thoroughly explored the worldwide procurement market for lithium-ion technologies and identified numerous dealers and manufacturers. This was followed by an analysis and evaluation of their technological expertise and competitiveness. A master agreement has already been signed with a renowned battery cell producer with a view to securing supplies.