Tuesday, July 23, 2024
The Blum Group concluded the financial year with a total turnover of 2,324.59 million euros, marking a decrease of 317 million euros compared to the previous year. From 1 July 2022 to 30 June 2023, the furniture industry has seen a significant decline in demand, especially since the second half of 2022. Philipp Blum, Managing Director of the Blum Group, commented, “After a period of high investment in home improvement, we have been observing a turning of the tide since autumn 2022. High levels of inflation, skyrocketing prices, and the global energy crisis have generated a feeling of immense uncertainty among end users, leading to restrained purchasing behavior.”
In addition to the challenging market environment, the costs of raw materials, energy, and human resources have remained high. Factors such as China’s strict COVID policies lasting almost a year and the cessation of deliveries to Russia have further slowed business. Despite these challenges, Philipp Blum emphasizes, “Although we need to adapt to this challenging situation, we are sticking to our basic strategy. Our long-standing corporate philosophy and values will remain our compass; we will continue to focus on close customer relations, innovation, and the further development of our 9,330 employees across the globe.”
The effects of inflation and uncertainty have been particularly felt in European markets over the past financial year. However, turnover remained stable in the Asia Pacific region, with the exception of China. The North American markets, especially the USA, have developed satisfactorily due to more robust economic conditions compared to Europe. Philipp Blum noted, “The drop in orders is challenging, and we need to prepare for another difficult year. We have taken on the challenge and believe that markets will recover in the medium term.”
Despite the downturn, Blum continues to invest significantly in its premises in Vorarlberg and worldwide, with a total investment volume of 390 million euros in the past financial year, 255 million of which was allocated to Vorarlberg. Upcoming projects include the creation of 52,000 sq. meters of production and storage space at the main site in Vorarlberg. The completion of Plant 6 in Gaissau is expected this summer, while extensions to Plant 2 in Hoechst and Plant 4 in Bregenz are progressing well. Additionally, after three years of construction, the Chinese production site in Shanghai was inaugurated in March.
The family business is also evaluating potential sites for a new plant in eastern Austria to expand production capacity for box systems. Martin Blum emphasized the importance of training young people, with the company expanding its apprenticeship programs, including a new IT apprenticeship in Application Development and Coding starting in September 2023.
Blum’s innovative drive remains strong, with 79 new applications in 2022, placing second in the Austrian Patent Office rankings. At interzum, the international furniture industry fair in Cologne, Blum showcased its product portfolio and innovations under the motto “FOR EVERYONE,” addressing different requirements and lifestyles. Highlights included the AMPEROS electrification solution, the AVENTOS HKi lift system, and the REVEGO pocket system.
Blum’s commitment to sustainable business practices is highlighted in its first sustainability brochure, published at interzum in May. The 80-page document details the company’s efforts to reach the United Nations’ 1.5-degree climate change goal, covering areas such as product sustainability, energy use, transportation, mobility, and closed-loop recycling.
As of 1 July 2023, Blum’s Management Board has been expanded to include Wolfgang Heinzle, Alexander Roloff, and Klaus Wendel, alongside Martin Blum, Philipp Blum, and Gerhard Humpeler. This enlargement is in response to the company’s increasing size and complexity, as well as its potential for growth. Philipp Blum expressed confidence in the strengthened team, stating, “We will work with experts across all fields to further develop the company and take on the challenges we face, because only together will we succeed,” explains Philipp Blum.
Outlook
Both Blum Managing Directors continue to anticipate a difficult order situation. “We’re going to need a lot of perseverance until consumer confidence and markets stabilise again”, explains Philipp Blum. “Our long-term orientation and committed and flexible employees are our strength and what make us a reliable partner for our customers on a daily basis. Our thanks and appreciation go to our global team that stands strong despite daily challenges,” concludes Martin Blum.
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