-- Tente specializes in heavy duty casters and wheels for industrial uses.
-- Würth is the leading industrial supplier of assembly and fastening materials worldwide.
-- Dorma makes doors and related accessories.
-- Rational makes ovens for professional kitchens.
-- Other examples include RUD (industrial chains), Koenig & Bauer (printing presses), Utsch (licence plates), Aeroxon (environmentally-safe insecticides) and Kärcher (high-pressure cleaners). The German renewable energy sector (wind energy, solar photovoltaics and biomass) has been the world's leader for many years, and much of it is driven by SMEs that are now expanding into international markets.
I interviewed the co-owner of Hegra Linear, a leading manufacturer of what is known as mechanical motion technology, based near Frankfurt. Their company has about 25 employees, and produces a little-known niche product: telescopic slides and linear guiding systems. These are high tech, low-friction shelves, slides and drawers needed in a wide range of industrial applications, including factory automation, automotive assembly, airplane production and more. For example, if you have a very large, heavy battery for a metro bus that you need to have easy access to for maintenance, then you need a way to smoothly slide that battery in and out. By setting that battery on one of Hegra Linear's high tech, near frictionless drawers, that makes it easy to slide it in and out and gain access. Hegra Linear does this extremely well, and business has grown rapidly in recent years. Said the owner, "We rely on our good reputation to bring in new customers."
These kinds of companies are not flashy or household names, but they are noted for having a relentless drive to produce high quality products, as well as stellar productivity and an obsession with improving operational performance. These SMEs are particularly strong in shop floor operations, with state-of-the-art, lean manufacturing practices that flows from their intensive investment in research and development.
While Germany's economy shrank in the last measured quarter, mostly
due to the collapse of the overall European economy, it still runs a
trade surplus with much lower unemployment than the U.S. German Chancellor Angela Merkel
once was asked by then-British prime minister Tony Blair what the secret
was of her country's impressive success. She famously replied, "Mr.
Blair, we still make things." In Germany, manufacturing still dominates
finance, not the other way around, as Germany has continued to
emphasize manufacturing and exports over the financial industry.
THE POWER OF WAGES
The conventional wisdom among some observers of the U.S. economy is that manufacturing can't compete with low-cost labor in China. Germany has shown this viewpoint to be utter rubbish. One study by the US Bureau of Labor Statistics found that hourly manufacturing compensation (wages plus benefits) was $48 in Germany and only $32 in the United States (that study was for all manufacturing workers, not just those in SMEs, but Germany's manufacturing workers in SMEs make comparable wages to those working for their large corporations).