Freudenberg Sealing Technologies (FST) is expanding its commercial business globally based on the model that it has used successfully in Europe. Partner events have taken place in Asia, North America and Europe.
FST is unable to support every industrial customer directly. It takes fi rst-class partners to create a wide-ranging presence in the market, stay close to customers in diff erent regions and provide high product availability. Here FST is choosing quality over quantity. “We want to work with the best distributors, the ones with the necessary technical expertise who can give expert advice to the end customer,” said José Caro, Vice President, Strategic Global Distribution.
The Freudenberg Preferred Partners (FPPs) are the cream of the crop. Currently, 61 technical distributors with a total of about 400 branches are members of this exclusive group – and the number keeps rising. This doesn’t mean that FST is loosening its strict standards for the selection of its partners. On the contrary, the benchmark for the quality and capabilities of Freudenberg’s certified commercial partners has not changed – it is still very high. There is another reason for the growing number of FPPs. While the commercial business has mainly focused on Europe in the past, FST is now working to expand it globally, and the eff ort is proceeding very systematically.
The globalization is making even faster progress than planned. In its commercial business this year, FST has reached the strategic sales goals that had been expected no earlier than the end of 2023. Matthias Arnold, Business Development Manager, Global Distribution, expressed confidence about the future. “There is still more opportunity,” he said. Since 2017, the commercial business has been part of the Industrial Services Division, first of all, in Europe, Asia and other export markets, and now in the United States. In all, sales through commercial channels are generating two-thirds of the Division’s sales.
FPP, FAP, FID and FDD
China, India, Southeast Asia, South Korea, Australia, Mexico, North America – FST is now accelerating the expansion of its distributor network and its business based on the commercial model that proved successful in Europe. Freudenberg Approved Partners (FAPs), who are also technically savvy and off er a complete product line, are joining the FPP premium distributors. Distributors with cross-region and international operations are known as Freudenberg Industrial Distributors (FIDs). They are mainly in the U.S. Freudenberg Dichtomatik Distributors (FDDs) concentrate on products from FST’s Dichtomatik brand.
There are key diff erences from region to region. For example, distributors in North America and China serve considerably more OEM customers than those in Europe, where the replacement parts business (MRO) plays a larger role. In Europe, traditional family businesses tend to dominate the landscape. In the United States, there are veritable commercial giants. For one thing, the companies in the market are mainly generalists, selling a huge range of items, everything from roller bearings to work clothing, while the share of seals is rather small. For another, the market has been shaped by technically adept distributors concentrating on hydraulic and sealing applications.
“When our distributors are successful, so are we”
But some things apply to the whole world: “We must put our distributors in a position where they can make good money with our products. When they are profitable and successful, so are we,” Caro said. That takes leadership and support: pointing out opportunities in the market, developing logistics concepts, passing on knowledge, jointly defining target customers, making modern digital tools such as the EASY ordering platform available, along with configurators and calculators. Those are some of the key success factors.
Not to mention training. “Right now, we are organizing a global training program for our distributors,” Caro said. This includes in-depth training for 20 international trainers from the company’s own ranks. They will then pass their expertise onto distributors and their customers. Web-based tools, adapted to individual requirements, are one aspect of the training. After all, a distributor‘s warehouse worker doesn‘t need the same information that a product manager requires.
Throughout the world, FST is building on reliable, stable partnerships with carefully chosen distributors, creating a select network in which all the trade partners have potential for growth. “We are acting globally – with a standardized approach. We are pursuing the same logic on pricing everywhere and are treating every dealer within a category the same,” Arnold said. Around the globe, the FPPs enjoy the highest status and the most advantages, including the chance to get information at regional partner events and tune into details about the collaboration. These gatherings have long been customary in Europe. This year, meetings with trade partners from the Asia-Pacific region and distributors from the Middle East were held for the first time. And Industrial Services was the host of the FPP event in North America for the first time.
Setting Loyalty Records
Two very special events took place at two distributors this year. Freudenberg Preferred Partners Franz Gottwald GmbH + Co. KG and Carl Werthenbach Konstruktionsteile GmbH & Co. KG were honored for their loyalty to Freudenberg. Gottwald has been one of Freudenberg’s trade partners for 85 years. At 90 years, Werthenbach is the record holder for loyalty and the length of partnership. José Caro, Vice President, Strategic Development, highlighted the special character of these cooperative efforts. “Our collaboration is older than many of our competitors are,” he said. In both cases, the term “partnership” takes on aspects of friendship and a family relationship.
