Chain reaction Stihl

CHAIN REACTION

As the inventor of the world’s first chainsaw, Andreas Stihl remains the global leader in the development and manufacture of chain saws and other hand-held power tools. A continuous investment programme and a clear focus on innovation has resulted in a company that is breaking all records in terms of both new products and sales revenues. Philip Yorke reports.

Andreas Stihl began his career as a salesman for a German mill and industrial supply house. This brought him into contact with loggers in the Black Forest, where the felling of trees was carried out with stationary saws or laboriously by hand. In 1925, Stihl decided to bring more modern tree felling methods to the trade and established a small workshop in order to develop the world’s first ‘portable tree-felling’ machine, this was an electric chain saw that weighed in at 140 pounds.

Based in Walblingen, Germany, Stihl continues as a family-owned business that remains the world’s number one chainsaw brand, as well as producing a wide variety of outdoor power tools and equipment that ranges form brush-cutters and edgers, to hedge trimmers and blowers.

Today Andreas Stihl is present in more than 160 countries worldwide and operates state-of-the-art plants in Germany, Switzerland, Brazil and the USA and in 2008 it made a major investment in new production facilities in Qingdao, China. In 2014 the company generated sale of more than €2.8 billion with over 12,300 employees and achieved a turnover of more than €2.8billion. Leading through innovation

The culture of entrepreneurial innovation and customer service has been at the heart of Stihl’s culture since Andreas Stihl invented the world’s first chain saw in 1926. Other milestones include the automatically lubricated chain and guide bar via a unique oil lubrication system, launched in 1934, and in 1936 a centrifugal clutch was introduced that ensures that the saw chain is automatically advanced as the engine speed increases. In 1972 the company also announced its new electronic ignition and chain braking system, that can bring the chain to a halt in a fraction of a second of the chain ‘kicking back’.

Following a constant stream of innovations through the years the company more recently introduced its 2-Mix Engine that offers up to 70 per cent fewer emissions and up to 20 per cent less fuel consumption. Finally, the company’s most advanced chainsaw ever produced was introduced to the market in 2010. The Stihl M-Tronic is a

remarkable new product that features full electronic controlled ignition timing and an advanced fuel metering system. Furthermore the carburettor is automatically adjusted to accomodate any changes in altitude, temperature and fuel quality.

However, it is not only the company’s chainsaws that can claim that they are the most innovative and efficient hand held power products in the world. Other products, such as the company’s new BGA 100 cordless blower, are being launched soon. It will be the most powerful, and quietest cordless blower on the market with a sound power level of only 90dB.

Focus on Scandinavia

With sales continuing to see strong growth in Scandinavia and in particular in Finland, the Stihl Group has founded a wholly-owned sales subsidiary there. The new company, Andreas Stihl Oy, is based in Vantaa near Helsinki and has taken over the responsibility for covering the local market for Stihl and Viking chainsaws as well as for other outdoor power tools and garden equipment.

At the opening ceremony, advisory and supervisory board chairman Dr Nikolas Stihl expressed his confidence in the continuation of the positive growth in the Finnish market when he said, “I see great potential for our products in Finland with its vast forested areas.”

The opening ceremony on 20th March this year in Vantaa, Finland was attended by Stihl staff, Stihl dealers and representatives from the press. Interestingly, more than three quarters of the land in Finland is wooded and it is one of the most sparsely populated countries in Europe with just 5.4 million inhabitants in an area that is almost as big as Germany.

Rewarding quality and commitment

Recently Andreas Stihl honoured five of its key suppliers with its ‘Supplier of the Year’ Award. Since 1990, Stihl has made the cov-

eted award to a total of 96 suppliers and 24 of those have won the award twice, whilst five have been honoured three times or more.

The assessment criteria for the award is based upon a supplier’s contribution in terms of quality, technology, innovation, service and price performance ratio. The ‘Supplier of the Year’ award spotlights the suppliers who have supported Stihl in a special way with their high quality, punctual deliveries, flexibility and specialist know-how.

The five recent winners are: BPS-Tec GmbH of Schorndorf, Germany for engineering services; Domel d.d. of Zelezniki, Slovenia for electric motors and generators; HAMA Mould Technology (HK) Ltd. of Hong Kong, China for injection moulds; Sapa Precision Yubing Lichtervelde NV, Belgium for its aluminium tubing and finally Salettra SRL, Bentivoglio, Itakly for flywheels.

Breaking fiscal records

In 2014 the Stihl Group achieved a record turnover of €2.98 billion, this was in spite of various international crises and the unfavourable effects of foreign exchange rates. Compared with the previous year growth was almost 6 per cent and would have been as high as 9 per cent had it not been for changes in foreign exchange rates.

Investment in new plant therefore remains high and Stihl’s worldwide network of manufacturing facilities was further extended last year with manufacturing subsidiaries accounting for 88.3 per cent of investments, representing €161 million. In addition, the construction of a new production plant for ZAMA carburettors was started in the Philippines. The group will invest more than €40 million in this project alone. Production capacity was also expanded significantly at the company’s Chinese manufacturing subsidiary in Qingdao with the inauguration of a new building this year.

Entrepreneurial courage

At a special ceremony earlier this year Hans Peter Stihl was inducted into the ‘Hall of Fame of German Family Companies’ 2015 by the business daily publication: Handelsblatt. The jury honours entrepreneurs who have made an exceptional contribution to Germany as a business location.

“Hans Peter Stihl’s outstanding achievement was to transform a company with technically excellent chainsaws into a truly global brand. At a very early stage and long before others, he ventured out into export markets. His entrepreneurial courage and keen sense for new developments laid the cornerstone for Stihl’s global success,” said Klaus Beckker, chairman of KPMG AG, the international accountancy firm. n