| Type | limited partnership |
|---|---|
| Industry | retail, electronics, textiles, chemistry, services |
| Founded | Wuppertal, Germany (1883) |
| Headquarters | Wuppertal, Germany |
| Key people | Achim Schwanitz (Managing Partner), Markus von Blomberg (Managing Partner), Peter Oberegger (Managing Partner), Wolfgang Bahmann, Eberhard Pothmann |
| Products | household appliances, fitted kitchens, cosmetics, services, carpets |
| Revenue | 2.181 billion € (business volume 2005) |
| Website | www.vorwerk.com |
Vorwerk is an international diversified corporate group headquartered in Wuppertal, Germany. The main business is the direct distribution of various products like household appliances (e.g. vacuum cleaners), fitted kitchens or cosmetics. Vorwerk was founded in 1883.
Including sales representatives, the family enterprise, which is operated as a limited partnership, employs almost half a million people in over 60 countries worldwide, (as of 2005). For the year 2005, the company posted revenues of 1.772 billion euros; together with the associated akf group, business volume totalled 2.181 billion euros. Profits are traditionally not published.
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In 1883, the Barmer Teppichfabrik Vorwerk & Co was founded by the brothers Carl (1847–1907) and Adolf Vorwerk. That very same year, the brothers parted ways again and Carl Vorwerk continued to run the company. The firm initially manufactured high-quality carpets and upholstery fabrics, and later also the looms used to make them – first under an English patent, and then under an improved proprietary patent.
Carl Vorwerk’s son, Carl jr. (1878–1904), was to be his successor as company director, but he died just a few months after taking the helm in 1903. Thus, upon the death of the company founder in 1907, his son-in-law, August Mittelsten Scheid (1871–1955), became sole managing partner. Under his leadership, the company diversified following the First World War, taking up the production of gear units and electric motors for gramophones as its military research efforts halted.
As radio grew in popularity in the 1920s, gramophone sales dropped precipitously. This dire situation gave rise to the birth of the “Vorwerk Kobold” in 1929: chief engineer Engelbert Gorissen developed out of a gramophone motor a high-performance electric upright vacuum cleaner. On 25 May 1930, a patent was granted for the Kobold “Model 30”. At first, sales of what was at the time a completely unknown appliance in Germany were very poor, despite the relatively modest price of 20 Reichsmarks. Only when direct sales were launched in 1930 – the brainchild of Werner Mittelsten Scheid (1904-1953), a son of the company founder – did the product meet with success. By 1935, 100,000 “Kobolds” had been sold, by 1937 half a million and by 1953 one million. Already before the Second World War, in 1938, the first foreign sales organization was established: Vorwerk Folletto in Italy.
During World War II, the main plant in Wuppertal-Barmen was severely damaged in a May 1943 bombing, after which August Mittelsten Scheid’s sons, Werner and Erich Mittelsten Scheid, jointly took over management of the firm. The sales organization, which had held the company above water during the war years by selling various products, discontinued operations that year.
After the war was over, production and sales were rebuilt, first in Germany, and then in Europe and overseas. By 1955, 2,000 Vorwerk sales representatives were once again underway. Sole managing partner – following the death of his brother in 1953 – was Erich Mittelsten Scheid.
In 1969, Dr. Jörg Mittelsten Scheid, Werner’s son, succeeded his uncle as head of the family business. Three years later, Günter Busch and Bernd Balders became the first managing partners who were not members of the founding family.
While up to the end of the 1960s the company focused mainly on the production and sale of vacuum cleaners, carpets and upholstery fabrics, ever since that time it has continually diversified, initially into the services sector. Vorwerk was co-founder of the akf bank in 1968; in 1970 the in-house data processing department brought forth the ZEDA Gesellschaft für Datenverarbeitung und EDV-Beratung mbH & Co. KG; and the founding of Hygienic Service Gebäudereinigung und Umweltpflege GmbH in 1974 was the germ cell that led to the Hectas Facility Services division. At the same time, the company was also expanding its range of household products. This included the launch of the Thermomix food processor in 1971, followed by Vorwerk Fitted Kitchens in 1974.
The company kicked off the 21st century with a number of new acquisitions and restructuring projects. In 2001, Vorwerk purchased the Lux Asia Pacific direct sales organization from the Swedish Electrolux group, thus consolidating its position on the Asian market. The next year saw the introduction of the “Feelina” ironing system, and the year after that the spin-off of the company’s data processing services: ZEDA was sold to T-Systems in 2003. The final coup was the acquisition of American cosmetic manufacturer Jafra Cosmetics in May 2004.
At the end of 2005, Jörg Mittelsten Scheid left the board. Since January 2007, corporate management at Vorwerk has been in the hands of: Achim Schwanitz (managing partner), Markus von Blomberg (managing partner), Peter Oberegger (managing partner), Wolfgang Bahmann (human resources) and Eberhard Pothmann (finance).
The consolidated Vorwerk group encompasses over 50 companies worldwide, which are divided into three main fields of business. A fourth field is formed by the companies in the akf group, in which Vorwerk has a 90.05% share, but which, since they are not managed across-the-board by Vorwerk, are only included in the group financial statements as an associated enterprise according to the equity method.
as well as sales companies in Germany, Austria, Italy, France, Spain, Czech Republic, Poland, Russia, Portugal, China, Taiwan, Mexico
as well as additional sales companies in Mexico, Germany, Switzerland, Austria, Italy, Netherlands, Dominican Republic, Russia, Brazil, India
as well as additional sales companies in Japan, Indonesia, Thailand, Taiwan, Australia, Vietnam
as well as additional subsidiaries in Germany, Austria, Netherlands, Czech Republic, Poland, Belgium, Greece
as well as additional subsidiaries in Spain
Advisory board for the managing partners:
The steady growth in business volume during the past few years received an additional boost through the purchase of Jafra Cosmetics in 2004. The first full year with Jafra brought a new record turnover of almost 2.2 billion euros, an increase of 5% over the previous year. According to the company, there has also been a “significant” improvement in results. The share of business volume outside of Germany is given as 56%.
After Vorwerk had abstained from classic advertising until 2001 – with the exception of the carpets division – it launched that year a broad-based image campaign based on the so-called “Family Concept” under the slogan “Vorwerk – Our Best for Your Family”. According to Vorwerk, the aim of the campaign is “to raise public awareness for a neglected area in social policy, i.e. the lack of recognition for work within the family”[1] or “to promote greater recognition for the achievements represented by childrearing and housework and to stand up for better public acceptance of these activities”,[2] in this way increasing the awareness of and popularity of the company – particularly among the relevant target group of housewives and househusbands. A central component of the “Family Concept” is the TV commercial first broadcast in 2003: “I run a very successful, small family business”, as well as the competition for “Family Manager of the Year” co-organized with the magazine Hörzu since 2004. The concept also includes the support of SOS Children's Villages by the Vorwerk Family Fund, established in 2002, as well as the financing of demoscopic studies on the recognition of housework.
The most tradition-steeped products in the range are the carpets and carpeting, the only business field in which Vorwerk has been active consistently since its founding in 1883. But Vorwerk is known chiefly for the production and sales of vacuum cleaners and accessories, and Division Kobold is the company’s biggest moneymaker today. Vorwerk Fitted Kitchens, the Thermomix kitchen appliance and the Feelina ironing system round out the portfolio in the household realm. New since the takeover of Jafra in 2004 are skin and body care products as well as cosmetics and perfume.
In 1985, Vorwerk sued the Chaos Computer Club (CCC), which had published on its Btx page an excerpt from a 1978 dissertation on “Penis Injuries When Masturbating with Vacuum Cleaners” that explicitly referred to the Kobold brand. Vorwerk feared for its reputation and brought an injunction according to which CCC would have to pay a penalty of 500,000 DM for any violation.[3] When the dissertation supervisor and someone affected by the problem described introduced themselves to Vorwerk, they were able to convince the company of the seriousness of the source and Vorwerk withdrew its suit. In Germany, Vorwerk has been strongly associated with door-to-door sales at least since the launch of direct distribution of the Kobold vacuum cleaner. In his 1999 documentary film, Die Blume der Hausfrau, which achieved some success in German repertory cinemas, director Dominik Wessely portrayed the work of the Vorwerk sales advisers.
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