The Blum Group generated a total of 2,376.75 million euros in sales from July 1, 2020 to June 30, 2021. The large growth corresponds to an increase of 24.7 percent or 470 million euros compared to the previous year. The increased demand in furniture construction worldwide due to the Corona pandemic has also caused a disproportionate increase in sales for the Vorarlberg-based hardware manufacturer and was not foreseeable. “One’s own four walls have gained in importance all over the world during the crisis. At the same time, there was a shift in private consumption – away from classic leisure activities and towards investments in one’s own home. Among other things, also in kitchens and furniture,” says Philipp Blum, Managing Director of Blum, explaining the development.
Although furniture stores were affected by long closures in some cases during the lockdowns, demand in the home and furnishing sector increased worldwide. The markets of Western Europe recorded strong growth, particularly Italy, France, the UK and Germany. There were also major increases in Eastern Europe, such as Poland, Russia, the Czech Republic and Turkey. The North American markets also developed well. There was also sales growth in the markets in Asia and Oceania – China again contributed strongly. Africa, South America and the Middle East also recorded a positive year. The hardware specialist supplies customers in more than 120 markets – with the establishment of Blum Indonesia in spring 2021, the company now has a total of 33 subsidiaries and representative offices worldwide. In order to be close to the customers, the international orientation through the local organizations and sales teams around the world has proven to be particularly important during the pandemic, Philipp Blum is convinced. The Blum Group’s sales distribution has remained constant compared to the previous year. “We still generate the largest part of our sales, namely 44 percent, in our home market, the European Union,” Philipp Blum informs. The USA remains the largest single market with a share of 13 percent, while the other markets worldwide contribute 43 percent to total sales.
“The great demand for kitchens and furniture, and thus for Blum products, is more than gratifying, but presents us with extreme challenges, especially in the production environment,” states Managing Director Martin Blum. The secure and reliable supply of fittings to its customers is the top priority for the long-established Vorarlberg-based company, he adds. “A big thank you goes to our employees. With their incredible commitment and flexibility, they have made a significant contribution to mastering this extraordinary year,” emphasizes Martin Blum. At the end of the business year, 8,778 colleagues work for Blum worldwide, 6,551 of them in Vorarlberg. Last year, 371 new employees were hired in Vorarlberg, and 429 worldwide. Apprenticeships – training young people to become skilled workers – remain an important factor for Blum in counteracting the shortage of skilled workers and positioning itself for the future in the long term. On September 1, 93 new apprentices will start their training at Blum in Vorarlberg, 8 young people in the USA and 2 in Poland.
The total worldwide investments for the past fiscal year amount to 259 million euros, 176 million of which in Vorarlberg. Even in these challenging times, Blum is investing constantly and in the long term in the expansion of its buildings, machinery and equipment. “Thanks to long-term planning, we were able to meet this unexpectedly strong demand in the best possible way in the first place,” says Martin Blum. The expansion at Plant 4 in Bregenz will go into operation this summer. At Plant 6 in Gaißau, the start for the expansion of production and the high-bay warehouse has already been made, with commissioning planned for mid-2023. “We are thus continuing to make a clear commitment to Vorarlberg as a production location,” informs Martin Blum. In terms of a healthy growth strategy, the Blum Group is strengthening its international orientation with worldwide investments. The plant expansion in Poland is also progressing, with Blum expecting completion from autumn 2023, while the construction of the production site in China will be completed at the beginning of 2022. “This is a fast-growing market – in order to meet demand in the Chinese market, we have decided to set up local production. This gives us greater flexibility, we are closer to our customers and avoid long transport routes,” explains the managing director.
The massive demand in the kitchen and furniture sector as well as other industries has led to an enormous shortage of raw materials such as steel for months. “Unfortunately, our customers are also having to wait longer for our products at the moment,” informs Martin Blum, adding, “It is only by partially adjusting delivery times that we are able to meet the rapid increase in demand from the markets.” The price of steel has almost doubled, but plastics, packaging, zinc or aluminum have also been affected by massive price increases. A similar development can be seen in the transportation sector: The entire international supply chain is under pressure, and prices have been increased, in some cases sensitively, in both land and sea transport. “Even though the situation is currently very challenging, our long-standing partnerships with our suppliers at least provide a certain stability,” Martin Blum is convinced.
Even in a turbulent economic year, Blum sees ongoing innovations in products and services as insurance for the future. With the hybrid event “Blum Connects” as part of the world’s leading trade fair “Interzum”, the family-owned company made use of digital technologies – in a combination of local events at the market organizations and digital elements, the hardware manufacturer presented its innovations to its customers worldwide. “Revego”, the pocket system as a solution for closing large fronts is in use for the first time at various customers and offers individual design options for small and large rooms. For minimalist design stands “Aventos HKi”, a fitting that is barely visible even when opened. Blum is also responding to the trend for dark and metallic surfaces in furniture fittings. “We try to support our customers’ design wishes for more individuality in kitchens and furniture with our hardware solutions,” reports Philipp Blum.
According to management estimates, the international supply chains and the availability of raw materials will remain so tight for some time to come. “We hope that – also due to the high vaccination coverage – we will be spared further lockdowns,” says Philipp Blum. At the same time, he says, the question is whether the homing trend and the associated shift in private consumption will last. For Philipp Blum, one thing is clear: “The experience we have gained as a company over the past year and a half is moving us forward. The digital possibilities offer many opportunities, however, they have also shown that personal conversations and exchanges cannot be replaced.” For the entire company, it is still important to be a reliable partner for customers worldwide.
