Case Study: FM Logistic and GROHE Partnership – effective factory logistics

Faced with expanding production plans and infrastructure that cannot keep pace with growth, companies confront a strategic dilemma: to invest in developing in-house facilities, which requires freezing capital, or to seek flexible solutions. GROHE, a leading global brand for complete bathroom solutions and kitchen fittings, was challenged with the question of how to effectively address growing demand in flushing systems for Eastern Europe in a flexible manner. The right answer proved to be production logistics, implemented in co-operation with FM Logistic at its platform in Tomaszów Mazowiecki.

Production logistics, also known as factory logistics, refers to a model in which a logistics operator becomes an integral part of its client’s production process. It is designed to keep the flow of materials as short as possible – from the components delivery to the finished products collection. It’s been of prime importance to GROHE to ensure the seamless and efficient running of its production operations carried out at FM premises. Components arrive at the FM Logistic warehouse from a number of different factories. They can end up in stock or go directly to the production line, where the individual elements are assembled. The finished product enters the second warehouse and it is then shipped off. It all happens very quickly.

Production logistics has been a cornerstone of the already five-year-long journey between FM Logistic and GROHE. Two dedicated warehousing zones have been established in Tomaszów Mazowiecki: one for components and the other for finished products, physically separated by the manufacturing area, operated and managed by GROHE staff. With the warehouse and production line under one roof, it’s possible to provide just-in-time deliveries, which means there’s no need to keep high inventories at the production site and thus the risk of downtime is mitigated. While the process takes place at FM Logistic’s premises, it is managed directly by the customer. The GROHE team places orders for components in their system. With its full integration with the FM Logistic warehouse system, the information reaches the operator in real time.

However, even the most advanced systems cannot replace the success factor: an experienced team made up of staff from both companies. Collaborative relationships, day-to-day open communication and a deep understanding of each other’s needs mean we can react quickly to changes and proactively address challenges. It’s a synergy where the client and operator teams don’t just work alongside one another, but closely together.

Working with a global manufacturer requires an operator to be ready for dynamic changes. GROHEs business has seasonal demand peaks that put operations to a test.

The nature of GROHE products presents additional challenges for the operator. The warehouse accommodates goods with special handling requirements, such as aerosols and batteries. At the same time, their high unit value calls for an uncompromising approach to safeguarding. Not only has FM Logistic introduced a machine-based pallet securing process to meet these requirements, but it has also equipped its distribution area with an additional camera system. Thus, the risk of complaints regarding both quantity and damage to goods has been mitigated.

The partnership between GROHE and FM Logistic goes far beyond traditional outsourcing. Carrying out part of the production process off-site presents both challenges and responsibilities. Working together as partners, building trust, and sharing our commitment, we have developed a model that ensures scalability and operational flexibility, as well as streamlining processes and optimising costs.