2019 Financial Report: Häfele increases revenue by 7.6 percent

Active in 150 countries throughout the world, the international Häfele Group for hardware technology, electronic access control systems and LED lighting, saw its revenue satisfyingly grow to 1.5 billion Euro in the previous year. That represents an increase of 7.6%. In view of the tense nature of the economic situation, Häfele's company management regards this result as a great success.

Häfele headquater in Germany

In the previous year, the parent company in Germany and its five production companies recorded growth of 3.3%, which sees them fall a little short of expectations. The main contribution to the good overall result was made by the 38 foreign sales companies – these grew by 8.8% in 2019. Once again, the strong growth registered in Asia and Eastern Europe was a particularly encouraging aspect of this. And the move towards internationalisation continues: The formation of Häfele Adriatic last July, sees the company gain another foothold in the Mediterranean region. Häfele Adriatic is the Group's 38th foreign sales company, and it services the markets of Slovenia and Croatia. And Africa is also forging ahead. Since February 2019, Häfele has been operating its own office in Tanzania, with responsibility serving the East African countries of Tanzania, Kenya, Uganda, Rwanda, as well as the Seychelles. This second base on the African continent is part of Häfele's preparations for growing its presence in the emerging market of East Africa. All told, the corporate group generated 80% of its revenue outside of Germany.

Number of employees continues to grow

The positive revenue performance is also reflected in the number of employees: Their number globally increased by 300 to 8,100 last year. 1,650 of this figure are staff, trainees and students employed in Germany (50 more than in 2018). This increase can be primarily attributed to the acquisition made in February 2019 of the Stuttgart-based LED lighting specialist, Nimbus – a German pioneer of high-quality designed LED room-lighting.

The youngest members of the great big Häfele family – trainees and students from the 2019 training year

Strategic investment in competence field light

By acquiring Nimbus at the beginning of last year, Häfele has expanded its expertise in this area by adding room lighting to the product segment formerly known as "LED light in furniture". This strategic decision means that room lighting and light in furniture can now be systematically and collaboratively designed and realised at one single point, while taking account of aspects such as well-being, functionality and design, something that hugely increases the creative design space. And with their 360° comprehensive project solutions, Häfele and Nimbus naturally assist their partners in the market, from the idea to the realisation stage.

Showing off of the light effect of a Nimbus Lighting Pad

Smart functionality trend-setter for a digital world

The hardware technology specialist has also become something of an industry pioneer when it comes to the growth market for Smart Home ideas and products: "Häfele Connect" networks and controls lighting and sound as well as electric drives in furniture. The innovation is based on components belonging to the Loox LED lighting system, an app for smartphones and tablets, as well as the first room-lighting solutions from Nimbus. The development is part of Häfele's preparation for a smart world that interlinks furniture and rooms. So it's clear that Häfele has radically developed beyond its traditional world of classic hardware fittings for doors and interiors. Through its smart components the company is establishing itself within the digital world, true to its motto "Thinking ahead".

Equipped with a VR headset and control unit, this customer is taking a virtual tour through her newly-designed kitchen.

Enhancement of logistics expertise

The expansion of our logistic services – an important driver of success at Häfele – was another focal aspect of the previous financial year. In Lehrte near Hanover, Häfele has commenced operating a second distribution centre for supplying customers located in the north of Germany and neighbouring countries. With this second warehouse as an addition to the major logistical hub in Nagold, the logistics of Häfele Germany now has two mainstays – for more proximity to customers, shorter transport times and therefore even better service. Designed for the rapid throughput of orders, the warehouse guarantees that all customers in Germany and neighbouring countries will receive their goods on the following day. In addition, the deadline for accepting “next-day” deliveries has been extended yet again.

 
New distribution centre in Lehrte near Hanover

Training opportunities further enhanced

Häfele looks to training programmes to continue enhancing its digital expertise. As recently as 2018, it has added apprenticeship positions for e-commerce merchants, as well as places for students of the dual program, Business Administration and Digital Business Management. With an eye on the progressing level of internationalisation, last year the Group added the new Business Administration and Engineering course, with main focus on International Technical Sales and Purchasing. Häfele has a tradition of offering training places to merchants for wholesale and foreign trade, together with study programmes in partnership with the Baden-Wuerttemberg Cooperative State University (DHBW).

Häfele and its partners – a global network

Häfele supplies the world's leading furniture manufacturers, architects and planners as well as its joiner/cabinet maker partners and dealers with its products and services. It's all based on customized ranges which are either manufactured in one of the company's five production facilities or in line with the "Häfele German Quality standards" at one of the locations of their 1,500 partners spread around the globe. Alongside a continuously enhanced in-house service portfolio, Häfele is expanding its range of smart solution products and concepts through strategic partnerships, which will be continually upgraded throughout 2020. These partnerships are extremely relevant to Häfele's customers, and offer, for example, hospitality solutions such as smartphone apps that replace the traditional room-key, or the interlinking of access systems and room controls.

Outlook for 2020

The Group is looking somewhat cautiously towards the new financial year. Following the positive start made in the first quarter of 2020, current developments in Western and Eastern Europe, as well as North America and South East Asia mean that the company does not expect that the net sales achieved in 2019 will be repeated this year.

"The corona pandemic means we are now operating in crisis mode worldwide. So, we are reviewing our investment plans and everything that isn't vitally important is going on the back-burner until the situation has returned to normality," explains Managing Director Sibylle Thierer. Nevertheless, we will still be pushing forward with many of the measures already initiated, including the continuous development of our own house assortments, the digitalisation of the processes, and our new target group-focussed distribution structures.

In view of the current crisis, the Häfele Group has adopted additional measures to secure the supply chain – including after the crisis has ended – and to more closely interlink the Group's companies. To this end, the business will compare global demand with its global inventories, so that it can strategically control our suppliers' distribution of products, ensure that the companies get the level of stocks they need, and optimise the inventories worldwide.