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Blum’s Growth Hinges on Service, Innovation

When Austrian cabinet hardware maker Julius Blum GmbH set up its U.S. operation in southern Lincoln County in 1977, it wanted to be near North Carolina’s furniture industry. The company relies on more than Tar Heel furniture manufacturers for its sales. Family-owned Blum has grown to become the largest kitchen hardware manufacturer in the country, and one of the two largest in the world. Blum, which specializes in concealed hinges and drawer-runner systems, sells its products to a farflung range of kitchen-cabinet businesses, from large manufacturers to local custom cabinetmakers. “In the medium to upper-end kitchen, Blum is a known name,” says Karl Ruedisser, chief executive of U.S. operations. Its U.S. revenue grew by 160% in 2002. And that was on top of a 150% increase in 2001. According to the latest annual figures available, the U.S. subsidiary, called Julius Blum Inc., had sales of $132.5 million, nearly a quarter of the $555.5 million generated by Julius Blum GmbH worldwide. Ruedisser attributes some of Blum’s U.S. growth to the nationwide residential housing boom. But he stresses other, longer-term factors for growth. Just-in-time manufacturing has proved a critical business strategy. Blum has developed its own in-house logistics system, which Ruedisser says has been essential to the company’s success. He also cites innovations in service and a new vendor-management inventory system. Equally important, he says, is face-to-face contact with customers and the building of long-term relationships. “We are very customer-focused,” he says. “We listen to the customer, and we try to focus on the product that both the customer and the end-consumer need.” The company has earned numerous honors for design, along with several supplier-of-the-year awards. Plant operations are ISO-9001 certified. The company’s product innovations include noiseless cabinet drawers and self-closing systems for drawers and doors. The Lincoln County plant remains Blum’s only North American manufacturing facility. It has seen seven expansions, growing to 350,000 square feet from the original 30,000. The Blum complex employs 390. The company’s design responsibilities are shared between the local plant and its European parent, with market research conducted here and engineering concentrated in Hochst, Austria, where the global company is headquartered. Blum has other subsidiaries in Canada, Great Britain, Sweden, Norway, France, Germany, Australia, Russia and Poland. The company was founded in 1952 by Julius Blum, a blacksmith who first made horseshoe studs. Ruedisser, who came here from Austria to open the local plant and stayed on as its top executive, is optimistic about Blum’s growth prospects. The company’s reputation for innovation and service should serve it well in the face of growing competition from low-cost imports from China, as well as other suppliers, he says. Ruedisser states his goal simply: “To remain a leader in the cabinet hardware field.”