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Logistics Geography – Germany

The development of the internal market and foreign trade turnover entails the need to develop infrastructure and services related to production supply, warehousing, and the flow of goods and information. Schenker, a provider of integrated logistics solutions, shares its knowledge regarding solutions used by various countries. Schenker’s experience with the German market is knowledge useful to any company interested in cooperating with our western neighbor. It is a collection of information concerning both the sphere of infrastructure, transport, and logistics, as well as specialized logistics solutions dedicated, for example, to the automotive industry.

Economically speaking
Germany is Poland’s largest foreign trade partner. An important element of the exchange between Poland and Germany is the synchronization of deliveries throughout the entire logistics chain. Companies from Germany cooperating with Polish entrepreneurs expect goods and services of the highest quality standards. Our neighbors, alongside the United States and Japan, can boast one of the largest economies in the world. Despite economic problems appearing over the last few years, contributing to a decline in the growth dynamics and competitiveness of the German economy relative to rapidly developing countries (China, India), Germany still holds a strong position at the forefront of countries introducing new technologies and products to the market.

The German economy has for years been oriented towards the development of the TSL (Transport, Spedition, Logistics) services market. To this end, state policy focused on creating favorable conditions for the development of the logistics and transport industry. Consequently, investments in road, seaport, and airport infrastructure, as well as the development of inland navigation, were implemented in Germany.
– As a consequence of such actions, Germany belongs to the European countries with the most developed structure of logistics services. The solutions they offer are based on the most modern technologies using road, rail, air, and sea transport, as well as inland navigation – says Zbigniew Pabian, Deputy Director of International Land Business at Schenker Sp. z o.o.

From a logistics point of view
Germany, due to its convenient geographical location, constitutes a European logistics hub connecting the transit of goods in East-West relations of Europe and on the line: old and new continent. It should be noted that the progressing process of globalization contributes to the relocation of production centers to areas with lower production and logistics service costs. With the expansion of the European Union, Poland has a chance to become the logistics center of Europe.
– The introduction of new production systems translates into the multiple processing of components in various countries and geographical regions before their final assembly. Such a situation determines the need for cooperation with global logistics operators offering a full spectrum of logistics services – explains Zbigniew Pabian, Deputy Director of International Land Business at Schenker Sp. z o.o.

A very important role in the logistics process is played by transferring corporate experience to local markets. From a logistics point of view, e.g., the system of regular daily connections of the Schenker network in Poland with the Schenker organization in Germany gives entities operating in both countries wide access to services of the highest standards, implemented using modern technologies adapted to the individual needs of customers.

A way for efficient flows
One of the basic tasks facing logistics operators is planning delivery routes in such a way as to minimize “empty runs,” meaning that the means of transport is filled with goods in both directions.
– In the German Schenker network, to ensure daily deliveries from areas with lower goods flows, traffic takes place using transit terminals located in Hanover, Friedewald, and Nuremberg. These terminals carry out daily connections between themselves and terminals participating in the process handling carried out within the supply chain – explains Zbigniew Pabian.

The use of transit terminals in Hanover, Friedewald, and Nuremberg also improves the system of domestic services, which are carried out as part of the standard offer. This applies, among other things, to the delivery of parcels (Schenkerparcels), groupage shipments (Schenkersystem), Schenkersystem-plus services, Schenkersystem-extra/extralight, and also includes additional activities commissioned by the customer. Companies commission the logistics operator to transport dangerous goods, notify recipients, perform late pickups, provide temporary storage before delivery, deliver to multiple recipients throughout Germany at the same time, deliver packaging or perform self-packaging, check the quality of goods upon receipt from suppliers, and many other services agreed individually with customers.

Automotive for the advanced
The automotive industry is very demanding. Every, even short, downtime of the production line causes very large losses. Manufacturers, wanting to avoid such risks, look for responsible partners – logistics service providers who can meet specific quality and deadline criteria. Why is this the case? An average-sized car consists of approx. 3,500 parts. Each of them must be collected from a subcontractor, transported, repacked, and delivered to assembly points often thousands of kilometers away. In such a case, the use of global integrated logistics systems allows for significant savings in time and logistics service costs.

Schenker in Germany has over 20 years of experience in managing and designing supply chains for automotive companies. Key factors are: global reach and the ability to control the flow of goods from different parts of the world, organization of service implementation, and management of the delivery process. Efficient cooperation of all elements and people involved in the process is very important, as the final effect depends on the timely implementation of individual elements.

An example of advanced business ties between a client and a logistics operator is the cooperation of Schenker Deutschland AG with BMW AG. Activities are carried out within the main supply center of the BMW assembly line in Munich. – Schenker’s responsibility includes receiving deliveries of parts and materials to the center, quality control, warehouse management, and delivery to assembly lines at precisely defined locations, within a strictly defined time not exceeding 3 hours from the moment the order is placed. To meet the requirements of the automotive market, the Schenker team works in shifts from 6:00 AM to 12:00 AM. During one day, an average of 4,000 pallets are received into the warehouses, and the same number of pallets with materials, parts, and components are delivered to the assembly lines. As part of BMW service, Schenker is also responsible for empty packaging management – says Zbigniew Pabian.

The successful cooperation between Schenker and BMW in Munich resulted in another project – managing delivery logistics and operating the supply center at the new BMW factory in Leipzig producing the 3 Series model. – The complexity of services provided for BMW is complemented by the delivery of parts to distribution centers from suppliers both from Germany and around the world, as well as the delivery of spare parts to a network of 180 BMW dealers in Germany. Schenker also carries out deliveries of parts from the area of Germany for assembly in BMW factories around the world. – adds Zbigniew Pabian.

Logistics in the automotive industry is one of the most important specializations of Schenker, which cooperates with the largest car manufacturers: VW, BMW, GM (Opel), Ford, Toyota, Mitsubishi, Daimler Chrysler. In the logistics division of the Deutsche Bahn AG Group, where Schenker plays a key role, approx. 30% of turnover is accounted for by automotive industry service. To meet customer requirements, Schenker uses solutions within specialized units:

• Automotive Transport System (ATS) – in the implementation of supply deliveries (spare parts distribution, return and empty packaging handling), Schenker’s land network connections cooperate with external suppliers
• Schenker Automotive RailNet (SAR) – deliveries of materials, spare parts, and finished components are carried out by rail using specialized wagons, containers, and high-capacity swap body units
• Logistics Solutions & Services – specialization in logistics solution projects in the area of network and supply chain management from the analysis and business model development stage to implementation inclusive.