Responsibility in the supply chain

Purchasing volume and procurement markets

The companies of KraussMaffei work with a wide variety of suppliers from around the world. In 2015, we procured our materials and services from more than 10,000 active suppliers. Slightly more than half of our suppliers come from Germany (5,709), 3,104 from the rest of Europe and 1,064 from the USA. Currently, only a small portion of our suppliers (566) is based in Asia. Nevertheless, in conjunction with our ever-expanding production in China, we plan on expanding our supplier network in Asia as well. In 2015, our procurement volume of materials and services totaled approximately 771 million euros. Production material accounts for just under 80 percent of the purchasing volume (609 million euros).

Germany, with a proportional purchasing volume of 62 percent of our materials and services, is our main focus. The percentage in the rest of Europe and America is 33 percent. In Asia, this figure is 5 percent. Currently, the greatest potential for development to increase local purchasing volume seems to be in Asia.

Procurement markets according to purchasing volume 2015      Image
Germany 62 %           
Rest of Europe        25 %  
America 8 %  
Asia 5 %  

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Supplier and quality management

Our Supplier and Quality Management area maintains long-term relationships with our suppliers based on trust. In our group directive on sales processes, we include basic conditions and prerequisites for goods procurement and external service utilization procedures. The individual companies implement these requirements on site and integrate them into the sales process. The CEO of the local subsidiary is responsible for reviewing the directives and changing them based on the local conditions and laws.

The Procurement department pledges to uphold the following basic principles in order to handle the procurement activities of KraussMaffei professionally, in accordance with contracts, in a uniform manner and at optimal cost:

  • Objective and transparent selection of suppliers
  • Fair treatment and equal opportunity of qualified suppliers in the assignment of contracts
  • A clear description of the nature of the respective supplier relationship and associated requirements for the respective supplier relationship
  • Internal and external communication of the nature of the respective supplier relationship and associated requirements for the respective supplier relationship
  • Constructive cooperation with suppliers to continuously improve our collaborative work and identify areas of potential improvement.

In 2016, our Procurement department was restructured and since then, has consisted of three areas. Local Procurement supports the production areas at the various locations and supervises the local suppliers. Global Procurement gets involved when a measure benefits the entire group or suppliers have to be controlled across locations or segments. The third area, Governance, Processes, Tools, Controlling (GPTC), deals with procurement standards and processes. All three areas work closely together to expand knowledge of relevant procurement markets. The collective market intelligence is then reported to the Lead Buyer (the responsible buyer for a given material group, such as cast goods, machine beds, gearboxes or control technology), made available to this person and used for processes such as tender processes in the subsequent steps of the procurement process.

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Short distances and customer proximity – local procurement

As a globally active company, wherever possible and economically feasible, we take advantage of on-site options, i.e. local procurement markets. This offers two decisive advantages: first, we save money thanks to short distances. Secondly, we shorten delivery times and distances, actively preventing release of CO2 emissions.

By continuously developing our own in-house processes and systems, we achieve improved logistics, quality and reliability for our suppliers. To use one example, we established a new supplier system in Sučany (Slovakia) in 2015. In the future, the 20 top suppliers will be evaluated there in conjunction with the Logistics, Procurement and Quality departments using this systematic and simple supplier evaluation system. "The goal of the supplier evaluation is primarily to evaluate the reliability of the suppliers. This allows problems to be detected at any early stage and countermeasures to be defined.

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