DENCKERMANN auto parts have been known to Ukrainian car owner for decades. The brand is developing quite dynamically and attracts more and more attention. But only Ukrainian suppliers of Denckermann parts know about the company in details... autoExpert corrects the situation. For the first time all our questions are answered by Roman Denisyuk, Regional Export Manager of Denckermann Sp. z o.o., Warsaw.
45 years in filtration
- Roman, please tell us about the history of the Denckermann brand.
- The origins of the DENCKERMANN brand go back to 1972. At that time the company G.K Industries Ltd. was founded in Canada and specialized in the production of filters. In 1994, after more than 20 years of operation, production facilities were partially relocated to Guangzhou in China, 400 km away from Shanghai. And in 2013 a new factory was launched in Shanghai itself, close to the head office of the Chinese division.
The main production capacities of both the Canadian and the first Chinese factory were traditionally focused on supplies for the conveyors of car plants. The logical continuation of the activities of the group of companies was the decision to create a European division, which would represent the automotive aftermarket segment.
European logistics warehouse in Warsaw, Poland.
At first it was planned that the company would be located in Germany, so they stopped on a German-sounding brand. The German structure of the company was almost established, but a number of reasons influenced the fact that the project started in Poland. An important role in the choice of the country was played by logistics costs and wages, which are significantly lower in Poland.
At the end of 2006, the Polish company Denckermann Sp. z o.o. and the DENCKERMANN brand of the same name was founded. But as our company is rooted in Canada and our main capital is Canadian, we consider Denckermann brand Canadian.
The official website of the group of companies and the section where our production units are listed is www.gkindustries.com.
Toronto, Canada.
New factory in Shanghai, China.
The group of companies that founded Denckermann is an expert in filtered materials and filters. Therefore the first product group of the brand was passenger car filters. Later, Denckermann began to expand and develop other product lines. But we do not manufacture these products.
I do not hide the fact that our company produces only filters. And we are really experts in this subject. All the processes from the arrival of raw materials (metal, paper, plastic, polyurethane) to the release of the finished product are carried out in our factories. We also manufacture box filters such as Spin-On, filter inserts, filters with reinforced metal mesh and produce plastic filters by molding plastic ourselves. It's not an easy task, and not many companies have the ability to make plastic elements for air and especially fuel filters. For fuel filters, tightness and high precision are important. It took us a long time to perfect this technology and grind out the quality.
All other goods we do not produce, we only supply. Moreover, you have to understand that there is no single major brand that manufactures everything in its range. If someone says that he makes everything himself - this is never true.
- Why does a company consider itself an expert in filtration?
- It's very simple and complex at the same time. We have one of the newest filter factories in the world, opened, as I said, in 2013.
Why didn't we modernize the old one and open a new one? We hired an auditing company to evaluate the feasibility of upgrading the old factory. The auditors concluded that it was impossible to modernize the factory without stopping production. It was much easier and cheaper to build a new factory and equip it with modern equipment. The factory has its own laboratory, equipped with the latest technology.
The following example may serve as a demonstration of our high level. On the one hand this is a funny story, but on the other it is an extraordinary situation. There are only two suppliers of high quality filter paper in the world - Hollingsworth & Vose and Ahlstrom. These are the two main suppliers, with no one else around. There are smaller mills, including Chinese manufacturers - but they lag behind. We work with one of these two serious suppliers.
Once they sent us a shipment of paper that did not match the declared. As it turned out later, this was an unintentional mistake. Our lab can check any specification, so we checked and detected the error (which we always do!). The supplier was surprised that we have such technical resources and capabilities to perform such tests. Only a limited number of companies have such laboratories, so the supplier had no idea that we could control the quality of raw materials at this level.
After that the supplier offered us a meeting where we agreed to cooperate. If we develop any new filter design - we can pass the raw data of the future filter to the paper manufacturer, and based on our recommendations they will introduce new products. They are confident that our research and experiments are reliable because we have state-of-the-art equipment.
That's how we got into the first round of partners. The mistake turned out to be a good result for us and recognition of the world leader in the production of filtration materials. For us it had a huge meaning.
Objectively speaking, our new factory is now one of the most modern filter production facilities in the world. We are the only company on the planet that produces aluminum filters using cold-welded magnet technology. This technology is patented by us and is realized exclusively in the new factory.
Our chief engineer is an Italian who previously worked at MANN+HUMMEL, UFI. In 2015, G.K Industries signed an agreement with General Motors. At the moment we are their partner in the field of filtration solutions. We supply both for the assembly line and for their aftermarket brand. General Motors has several divisions, and we partner with GM North America. We make some of our products in Toronto, and the rest in a new plant in Shanghai. But it is the Canadian plant that takes on the main load of maintaining the supplies on the General Motors assembly line.
Only established mid-range and premium brands take the quality control system seriously. We make a lot of products for premium brands. Our customers are companies that are assembly line suppliers. But some items just aren't profitable for them to make, and they trust us to do it.
We have an ISO TS 16949:2009 supplier certificate for conveyor belts from the German certification body TUV. Even Americans, not to mention manufacturers in other countries, use the German certification bureau - they are the most trusted in the world.
- What is the role of the Canadian division in general logistics?
- Many processes take place in Canada: something is produced, something is labeled, something is packaged. But the logistics to the North American continent is built through Toronto. Nothing from China goes directly to the U.S. - everything comes first to Canada. That's where all the orders for the North American market are processed.
- What does the first Chinese plant produce?
- Its function is to serve the low price segment. The old factory does not meet the latest requirements - it was built in the early 90s. But the production cost can be low. Its products meet most regulations and quality standards, but still inferior to the new factories. The factory provides its own brand (Private Label) for many distributors of automotive components. They often choose the old factory, because the price there is 10-15%, and for some items even 20% lower. The low price is due to the cost of materials, technology and quality control. It turns out that we give the customer a choice: to buy filters made on Japanese equipment under the supervision of European specialists, or without it, but cheaper.
- Does the Polish division operate autonomously or also through Toronto?
- Denckermann Sp. z o.o.. - subsidiary company that deals only with the aftermarket, and it has its own logistics. If we talk about filters only, some of the products come from Toronto, and some from Shanghai. If we talk about other product lines, many of the supplier factories are in close proximity in Europe, and we get some items from China.
-Denckermann's European warehouse only receives products from the new factory?
- Yes, and not only from the new factory, but also from the Canadian one. Nothing comes from the old Chinese factory for the Denckermann brand for a long time now. We position the brand as products of original quality at an affordable price. We cannot afford to compromise or go along with some of our parters who want us to compromise on quality in favor of a very low price.
- Can the consumer see on the packaging what factory a particular filter is made in?
- Not on the packaging itself. Each filter is marked with a logo and a number, which shows the factory where it was made and the batch number. But to the uninitiated layman this number won't tell you anything. But distributors know where the products are made. All companies receive our goods with full certification and a description of our products. Customs is also interested in the country of origin, we provide a certificate indicating the origin of the goods.
- You named General Motors as the customer of your production facilities (not the Denckermann brand). What other big names are on the list of partners?
- OE partners are primarily General Motors. There are other global automakers, but I am not authorized to name them.
As to OEM - in this segment we make filters for several world leading producers, but again, I cannot name them. Let me remind you, the difference between "OE" and "OEM" is that in the first case it is the actual car assembly line, and in the second case it is the company supplying the car assembly line.
- On your website www.denckermann.pl, the brand awards are displayed in the appropriate section. What do they mean to you?
- We have already received the "GAZELS OF BUSINESS" award three times. It is awarded annually for the dynamics of the company's development during three years. This award is given to the fastest growing companies in Poland.
"FORBES BRILLIANTS 2017" is a weightier and more significant award. Forbes is known by everyone, so the award speaks for itself. It is awarded for the greatest increase in company value.
A great product for an affordable price
- What price niche is Denckermann in?
- Denckermann is a great product for a reasonable price. We have conveyor quality. This is the reason why it can't be cheap at all. Yes, we use high quality materials and have an expensive quality control system. But nevertheless we try to keep the upper level of the budget price segment, or as it is also called - the economy class. We do not aspire to the middle, much less the top niche. Our goal is to be available. We are not inferior to the premium segment in quality, they are identical products, but the difference in price will always be in our favor.
- Is the pricing policy the same in other groups?
- Of course it is. We try to make our offer as a whole, in one price segment.
- How do you get a lower price? What are you saving on?
- We're a young brand, so we have less support costs. We don't have a large staff, so we save a lot of money. But most importantly, we're not as "greedy. We do not make a margin like top brands, where the cost price is at our level, but the salaries of both top management and staff in "expensive" countries, such as Germany, and the cost of brand support make it necessary to pay a considerable margin.
- Can I say that the quality of top brands is better?
- I would not say so. When it comes to filters, we have identical products. We use the same paper, the same specifications, the same technology and the same equipment. The most important thing in a filter is the filter material, and we have the same material.
The main business of the top brands is supplying for conveyors. Naturally, they have a huge staff dedicated to developing new filters for conveyors. But they sell to conveyors with a minimum margin, and their expenses have to be recouped in the aftermarket.
We can sometimes copy some of their solutions or technologies, which are, of course, patented, but in our own way, and it is much cheaper. We are only inferior in that we need time: six months, sometimes a year, to create a similar product without violating the patent. Sometimes we lose a lot of time getting around the pitfalls. And if you infringe a patent, there will definitely be a lawsuit and you will have to pay huge compensation.
- Are your products packaged directly in factories or are there separate facilities?
- We have several concepts. One concept is getting the product already packaged. The other is no packaging, and we pack on-site. We have a line that allows us to pack the goods and, if necessary, make markings, put the logo on. Including on the metal - both by laser and by stamping. These works are carried out directly in Poland. There are also facilities for these tasks in China and Canada.
When it is necessary to maintain a wide range of products, we often work with a supplier who has an exclusive item, and no one else has it. For example, a coolant pump for some VAG cars with a housing and thermostat. When ordering a small batch, the item does not come in our packaging and without our logo. Therefore, we are obliged to apply our logo, mark the product and pack it in our packaging.
- The leading group is filters. And what are the second, third product groups?
- Yes. We have the highest turnover in filters. Number two is the suspension. Few people in Ukraine gives a guarantee on suspension and shock absorbers, we do. In Europe we give 2 years warranty, in Ukraine you should check with distributors.
- Apart from filters, could you give some examples of top-selling positions in other product groups?
- The best sellers are usually the items with a low price. People are looking for cheaper items. But a low price is low quality. And that is not our policy. That is why we sell all groups of goods. Both discs for Lanos, and discs, for example, for new Opel Astra, which only we and the original supplier of the assembly line offer.
- How do you choose your suppliers?
- Our company is interested in a good product, and there is not much choice in the world. We know who produces good and inexpensive, who produces bad and very cheap, and who produces great and very expensive. We focus on a good quality product, but do not strive to be the cheapest, then you can even think about manufacturers from Europe, from Turkey, there are good suppliers of original quality in China.
I have been to modern factories in China and Turkey. Famous brands that position themselves as a premium segment and cost twice as much as Denckermann are made in the same factories. They are absolutely identical products, the only difference is the strength of the brand and the margin.
- How is quality checked?
- All suppliers must have ISO TS 16949 certification - this is a must. In any case, this is a basic confirmation that a strict quality control system is in place and that the percentage of rejects will be absolutely non-critical in the total mass of goods. Availability of this certificate is one of the most important criteria when choosing a supplier for our product groups.
- Is it possible that a factory with a conveyor supplier certificate will not suit you for some reason?
- The first, of course, is the price. The second is that if the supplier's offer in terms of quantity is small, then there is no point in transferring resources and wasting time on companies that cannot provide you with a sufficient number of articles you need. Working with several factories at once makes no sense - the risk of complaints increases many times over. There is always a risk, but it increases if the goods come from several sources. You also need to organize stricter control.
The best option is to work with one supplier for a given product group who produces all the stock you need. There are very few factories like that. We work with two factories for suspension: a European and a Chinese one.
- What does your quality control consist of directly?
- When a shipment arrives, first of all all articles are checked according to the specification, dimensions. That is, first of all, so that there are no problems with packaging.
If we talk about quality control as such, for example, product groups related to braking system are necessarily certified in Europe. This is not the same as certification in Russia or Ukraine. The product in question cannot be allowed for sale in the European Union if it does not meet the requirements. ECR-90 certificate for brake pads and discs is issued only when the elements of the braking system have at least 75% of the original performance. If this is not adhered to, the product will simply not be allowed for sale. All of our pads and discs have these certificates.
This is a minimum, but no one will put the performance on the edge, so there may be 85%, and 100% compliance.
It's the same situation with the suspension. If we have a supplier which has the certificate of an official supplier for the conveyor of Peugeot-Citroen, what other warranties may we speak about? If Peugeot-Citroen controls everything all the time?
- Then why do you control the suppliers at the entrance to the warehouse?
- Trust, but verify. No one is immune to mistakes. Even manufacturers like Toyota or BMW recall their cars because of some defect. We have a special department that monitors the quality of incoming products. As I said, it's primarily a visual assessment: checking completeness and compliance with the order.
If there is a need to selectively check technical characteristics, we outsource this work to an independent laboratory. We ourselves can check only the shock absorber by basic characteristics: rebound, compression, vibration. We have the appropriate equipment. For the other groups, it is much cheaper and more convenient to outsource to external laboratories, especially since the Polish national accreditation laboratory for auto parts is not far from us.
A special example for bearings. We don't always use all the materials we are offered. For example, the factory uses ESO grease on our recommendation. The grease is very expensive. But it is our belief that the main problem with bearings is the lubricant. All data and laboratory experiments show that medium and high quality metal behaves similar when heated, and the main problem is the lubricant. That's why we instruct the manufacturer to work to our specification rather than the standard one. We think it's better to pay extra, but to have a guarantee that there will be no complaints at all. And we have no complaints about the bearings. This already says something.
- What makes and models of automobiles are you focusing your assortment on?
- We are guided by the car fleet that operates in Europe. These are European, Asian and American cars, including atypical models with large engines for the American market.
You may be surprised, but we even have filters for Mercedes-Benz W114/W115 cars from the late '60s. Not many others can offer you that. We have filters for both old cars and the newest Porsche, BMW, Bentley, etc.
We are not interested in a particular segment, we must have everything. And in other product categories we have the same approach.
- What countries does the European division focus its sales on?
- We supply our products to 36 countries. We supply from the North American continent to South Korea, from Ireland to South Africa. There are even exotic countries like Senegal. Naturally, to Germany, as well as to the Middle East (Lebanon), North Africa (Morocco, Algeria), and Azerbaijan.
After the start of the crisis in Russia in 2014, we were forced to focus on exports to other destinations: North Africa and the Middle East. Morocco, Algeria, Tunisia...
- You only have a range for cars. When do you plan to expand the offer to trucks as well?
- In the middle of 2016 we started to build a new line that would provide oil, fuel, air and cabin filters for the truck segment of the market. Apart from filters, we don't have anything in the truck segment. We will develop this direction first of all, we want to do something with our own resources at first.
We currently have some goods filters in our offer, but very little. By the end of the year, we will have a sufficient supply of filters for trucks.
- Are there any new product groups that will be added in the light-duty category?
- We are thinking about adding brake fluid and windshield wiper blades to the product range. At the moment we can only announce it.
The wiper blades will be 100% available to us, with the best price/quality combination on the market. I can't understand why quality wiper blades from established brands are so expensive. I see the price at which some premium brands buy wipers, and I understand that the price in the price list is formed by multiplying the purchase price by 3, sometimes more!
- Can you voice the percentage of reclamations?
- Strange as it may seem, but the percentage of reclamations from Ukraine is very small. There is a general opinion that in Ukraine, road conditions are bad, in addition to the fact that people often install spare parts for maintenance themselves. I don't know what percentage of complaints are rejected by the distributor, but according to the statistics that distributors send me, the percentage is very low.
Complaints have never exceeded 0.5% in each product group. For some items there are no complaints at all. For the company as a whole, complaints do not exceed 0.15%.
Alexander Kelm interviewed
45 years in filtration
- Roman, please tell us about the history of the Denckermann brand.
- The origins of the DENCKERMANN brand go back to 1972. At that time the company G.K Industries Ltd. was founded in Canada and specialized in the production of filters. In 1994, after more than 20 years of operation, production facilities were partially relocated to Guangzhou in China, 400 km away from Shanghai. And in 2013 a new factory was launched in Shanghai itself, close to the head office of the Chinese division.
The main production capacities of both the Canadian and the first Chinese factory were traditionally focused on supplies for the conveyors of car plants. The logical continuation of the activities of the group of companies was the decision to create a European division, which would represent the automotive aftermarket segment.
European logistics warehouse in Warsaw, Poland.
At first it was planned that the company would be located in Germany, so they stopped on a German-sounding brand. The German structure of the company was almost established, but a number of reasons influenced the fact that the project started in Poland. An important role in the choice of the country was played by logistics costs and wages, which are significantly lower in Poland.
At the end of 2006, the Polish company Denckermann Sp. z o.o. and the DENCKERMANN brand of the same name was founded. But as our company is rooted in Canada and our main capital is Canadian, we consider Denckermann brand Canadian.
The official website of the group of companies and the section where our production units are listed is www.gkindustries.com.
Toronto, Canada.
New factory in Shanghai, China.
The group of companies that founded Denckermann is an expert in filtered materials and filters. Therefore the first product group of the brand was passenger car filters. Later, Denckermann began to expand and develop other product lines. But we do not manufacture these products.
I do not hide the fact that our company produces only filters. And we are really experts in this subject. All the processes from the arrival of raw materials (metal, paper, plastic, polyurethane) to the release of the finished product are carried out in our factories. We also manufacture box filters such as Spin-On, filter inserts, filters with reinforced metal mesh and produce plastic filters by molding plastic ourselves. It's not an easy task, and not many companies have the ability to make plastic elements for air and especially fuel filters. For fuel filters, tightness and high precision are important. It took us a long time to perfect this technology and grind out the quality.
All other goods we do not produce, we only supply. Moreover, you have to understand that there is no single major brand that manufactures everything in its range. If someone says that he makes everything himself - this is never true.
- Why does a company consider itself an expert in filtration?
- It's very simple and complex at the same time. We have one of the newest filter factories in the world, opened, as I said, in 2013.
Why didn't we modernize the old one and open a new one? We hired an auditing company to evaluate the feasibility of upgrading the old factory. The auditors concluded that it was impossible to modernize the factory without stopping production. It was much easier and cheaper to build a new factory and equip it with modern equipment. The factory has its own laboratory, equipped with the latest technology.
The following example may serve as a demonstration of our high level. On the one hand this is a funny story, but on the other it is an extraordinary situation. There are only two suppliers of high quality filter paper in the world - Hollingsworth & Vose and Ahlstrom. These are the two main suppliers, with no one else around. There are smaller mills, including Chinese manufacturers - but they lag behind. We work with one of these two serious suppliers.
Once they sent us a shipment of paper that did not match the declared. As it turned out later, this was an unintentional mistake. Our lab can check any specification, so we checked and detected the error (which we always do!). The supplier was surprised that we have such technical resources and capabilities to perform such tests. Only a limited number of companies have such laboratories, so the supplier had no idea that we could control the quality of raw materials at this level.
After that the supplier offered us a meeting where we agreed to cooperate. If we develop any new filter design - we can pass the raw data of the future filter to the paper manufacturer, and based on our recommendations they will introduce new products. They are confident that our research and experiments are reliable because we have state-of-the-art equipment.
That's how we got into the first round of partners. The mistake turned out to be a good result for us and recognition of the world leader in the production of filtration materials. For us it had a huge meaning.
Objectively speaking, our new factory is now one of the most modern filter production facilities in the world. We are the only company on the planet that produces aluminum filters using cold-welded magnet technology. This technology is patented by us and is realized exclusively in the new factory.
Our chief engineer is an Italian who previously worked at MANN+HUMMEL, UFI. In 2015, G.K Industries signed an agreement with General Motors. At the moment we are their partner in the field of filtration solutions. We supply both for the assembly line and for their aftermarket brand. General Motors has several divisions, and we partner with GM North America. We make some of our products in Toronto, and the rest in a new plant in Shanghai. But it is the Canadian plant that takes on the main load of maintaining the supplies on the General Motors assembly line.
Only established mid-range and premium brands take the quality control system seriously. We make a lot of products for premium brands. Our customers are companies that are assembly line suppliers. But some items just aren't profitable for them to make, and they trust us to do it.
We have an ISO TS 16949:2009 supplier certificate for conveyor belts from the German certification body TUV. Even Americans, not to mention manufacturers in other countries, use the German certification bureau - they are the most trusted in the world.
- What is the role of the Canadian division in general logistics?
- Many processes take place in Canada: something is produced, something is labeled, something is packaged. But the logistics to the North American continent is built through Toronto. Nothing from China goes directly to the U.S. - everything comes first to Canada. That's where all the orders for the North American market are processed.
- What does the first Chinese plant produce?
- Its function is to serve the low price segment. The old factory does not meet the latest requirements - it was built in the early 90s. But the production cost can be low. Its products meet most regulations and quality standards, but still inferior to the new factories. The factory provides its own brand (Private Label) for many distributors of automotive components. They often choose the old factory, because the price there is 10-15%, and for some items even 20% lower. The low price is due to the cost of materials, technology and quality control. It turns out that we give the customer a choice: to buy filters made on Japanese equipment under the supervision of European specialists, or without it, but cheaper.
- Does the Polish division operate autonomously or also through Toronto?
- Denckermann Sp. z o.o.. - subsidiary company that deals only with the aftermarket, and it has its own logistics. If we talk about filters only, some of the products come from Toronto, and some from Shanghai. If we talk about other product lines, many of the supplier factories are in close proximity in Europe, and we get some items from China.
-Denckermann's European warehouse only receives products from the new factory?
- Yes, and not only from the new factory, but also from the Canadian one. Nothing comes from the old Chinese factory for the Denckermann brand for a long time now. We position the brand as products of original quality at an affordable price. We cannot afford to compromise or go along with some of our parters who want us to compromise on quality in favor of a very low price.
- Can the consumer see on the packaging what factory a particular filter is made in?
- Not on the packaging itself. Each filter is marked with a logo and a number, which shows the factory where it was made and the batch number. But to the uninitiated layman this number won't tell you anything. But distributors know where the products are made. All companies receive our goods with full certification and a description of our products. Customs is also interested in the country of origin, we provide a certificate indicating the origin of the goods.
- You named General Motors as the customer of your production facilities (not the Denckermann brand). What other big names are on the list of partners?
- OE partners are primarily General Motors. There are other global automakers, but I am not authorized to name them.
As to OEM - in this segment we make filters for several world leading producers, but again, I cannot name them. Let me remind you, the difference between "OE" and "OEM" is that in the first case it is the actual car assembly line, and in the second case it is the company supplying the car assembly line.
- On your website www.denckermann.pl, the brand awards are displayed in the appropriate section. What do they mean to you?
- We have already received the "GAZELS OF BUSINESS" award three times. It is awarded annually for the dynamics of the company's development during three years. This award is given to the fastest growing companies in Poland.
"FORBES BRILLIANTS 2017" is a weightier and more significant award. Forbes is known by everyone, so the award speaks for itself. It is awarded for the greatest increase in company value.
A great product for an affordable price
- What price niche is Denckermann in?
- Denckermann is a great product for a reasonable price. We have conveyor quality. This is the reason why it can't be cheap at all. Yes, we use high quality materials and have an expensive quality control system. But nevertheless we try to keep the upper level of the budget price segment, or as it is also called - the economy class. We do not aspire to the middle, much less the top niche. Our goal is to be available. We are not inferior to the premium segment in quality, they are identical products, but the difference in price will always be in our favor.
- Is the pricing policy the same in other groups?
- Of course it is. We try to make our offer as a whole, in one price segment.
- How do you get a lower price? What are you saving on?
- We're a young brand, so we have less support costs. We don't have a large staff, so we save a lot of money. But most importantly, we're not as "greedy. We do not make a margin like top brands, where the cost price is at our level, but the salaries of both top management and staff in "expensive" countries, such as Germany, and the cost of brand support make it necessary to pay a considerable margin.
- Can I say that the quality of top brands is better?
- I would not say so. When it comes to filters, we have identical products. We use the same paper, the same specifications, the same technology and the same equipment. The most important thing in a filter is the filter material, and we have the same material.
The main business of the top brands is supplying for conveyors. Naturally, they have a huge staff dedicated to developing new filters for conveyors. But they sell to conveyors with a minimum margin, and their expenses have to be recouped in the aftermarket.
We can sometimes copy some of their solutions or technologies, which are, of course, patented, but in our own way, and it is much cheaper. We are only inferior in that we need time: six months, sometimes a year, to create a similar product without violating the patent. Sometimes we lose a lot of time getting around the pitfalls. And if you infringe a patent, there will definitely be a lawsuit and you will have to pay huge compensation.
- Are your products packaged directly in factories or are there separate facilities?
- We have several concepts. One concept is getting the product already packaged. The other is no packaging, and we pack on-site. We have a line that allows us to pack the goods and, if necessary, make markings, put the logo on. Including on the metal - both by laser and by stamping. These works are carried out directly in Poland. There are also facilities for these tasks in China and Canada.
When it is necessary to maintain a wide range of products, we often work with a supplier who has an exclusive item, and no one else has it. For example, a coolant pump for some VAG cars with a housing and thermostat. When ordering a small batch, the item does not come in our packaging and without our logo. Therefore, we are obliged to apply our logo, mark the product and pack it in our packaging.
- The leading group is filters. And what are the second, third product groups?
- Yes. We have the highest turnover in filters. Number two is the suspension. Few people in Ukraine gives a guarantee on suspension and shock absorbers, we do. In Europe we give 2 years warranty, in Ukraine you should check with distributors.
- Apart from filters, could you give some examples of top-selling positions in other product groups?
- The best sellers are usually the items with a low price. People are looking for cheaper items. But a low price is low quality. And that is not our policy. That is why we sell all groups of goods. Both discs for Lanos, and discs, for example, for new Opel Astra, which only we and the original supplier of the assembly line offer.
- How do you choose your suppliers?
- Our company is interested in a good product, and there is not much choice in the world. We know who produces good and inexpensive, who produces bad and very cheap, and who produces great and very expensive. We focus on a good quality product, but do not strive to be the cheapest, then you can even think about manufacturers from Europe, from Turkey, there are good suppliers of original quality in China.
I have been to modern factories in China and Turkey. Famous brands that position themselves as a premium segment and cost twice as much as Denckermann are made in the same factories. They are absolutely identical products, the only difference is the strength of the brand and the margin.
- How is quality checked?
- All suppliers must have ISO TS 16949 certification - this is a must. In any case, this is a basic confirmation that a strict quality control system is in place and that the percentage of rejects will be absolutely non-critical in the total mass of goods. Availability of this certificate is one of the most important criteria when choosing a supplier for our product groups.
- Is it possible that a factory with a conveyor supplier certificate will not suit you for some reason?
- The first, of course, is the price. The second is that if the supplier's offer in terms of quantity is small, then there is no point in transferring resources and wasting time on companies that cannot provide you with a sufficient number of articles you need. Working with several factories at once makes no sense - the risk of complaints increases many times over. There is always a risk, but it increases if the goods come from several sources. You also need to organize stricter control.
The best option is to work with one supplier for a given product group who produces all the stock you need. There are very few factories like that. We work with two factories for suspension: a European and a Chinese one.
Denckermann product groups:
- Filters, including those for automatic transmission
- Cooling System: Water Pumps
- Rollers
- Brake system including wear sensors
- Suspension components: from stabilizer bar connectors, pivots, arms, bolts, and rubber-metal parts to complete arm sets
- Steering system
- Bearings and hubs
- Cushioning
- Transmission system: CV joints
- Filters, including those for automatic transmission
- Cooling System: Water Pumps
- Rollers
- Brake system including wear sensors
- Suspension components: from stabilizer bar connectors, pivots, arms, bolts, and rubber-metal parts to complete arm sets
- Steering system
- Bearings and hubs
- Cushioning
- Transmission system: CV joints
- What does your quality control consist of directly?
- When a shipment arrives, first of all all articles are checked according to the specification, dimensions. That is, first of all, so that there are no problems with packaging.
If we talk about quality control as such, for example, product groups related to braking system are necessarily certified in Europe. This is not the same as certification in Russia or Ukraine. The product in question cannot be allowed for sale in the European Union if it does not meet the requirements. ECR-90 certificate for brake pads and discs is issued only when the elements of the braking system have at least 75% of the original performance. If this is not adhered to, the product will simply not be allowed for sale. All of our pads and discs have these certificates.
This is a minimum, but no one will put the performance on the edge, so there may be 85%, and 100% compliance.
It's the same situation with the suspension. If we have a supplier which has the certificate of an official supplier for the conveyor of Peugeot-Citroen, what other warranties may we speak about? If Peugeot-Citroen controls everything all the time?
- Then why do you control the suppliers at the entrance to the warehouse?
- Trust, but verify. No one is immune to mistakes. Even manufacturers like Toyota or BMW recall their cars because of some defect. We have a special department that monitors the quality of incoming products. As I said, it's primarily a visual assessment: checking completeness and compliance with the order.
If there is a need to selectively check technical characteristics, we outsource this work to an independent laboratory. We ourselves can check only the shock absorber by basic characteristics: rebound, compression, vibration. We have the appropriate equipment. For the other groups, it is much cheaper and more convenient to outsource to external laboratories, especially since the Polish national accreditation laboratory for auto parts is not far from us.
A special example for bearings. We don't always use all the materials we are offered. For example, the factory uses ESO grease on our recommendation. The grease is very expensive. But it is our belief that the main problem with bearings is the lubricant. All data and laboratory experiments show that medium and high quality metal behaves similar when heated, and the main problem is the lubricant. That's why we instruct the manufacturer to work to our specification rather than the standard one. We think it's better to pay extra, but to have a guarantee that there will be no complaints at all. And we have no complaints about the bearings. This already says something.
- What makes and models of automobiles are you focusing your assortment on?
- We are guided by the car fleet that operates in Europe. These are European, Asian and American cars, including atypical models with large engines for the American market.
You may be surprised, but we even have filters for Mercedes-Benz W114/W115 cars from the late '60s. Not many others can offer you that. We have filters for both old cars and the newest Porsche, BMW, Bentley, etc.
We are not interested in a particular segment, we must have everything. And in other product categories we have the same approach.
- What countries does the European division focus its sales on?
- We supply our products to 36 countries. We supply from the North American continent to South Korea, from Ireland to South Africa. There are even exotic countries like Senegal. Naturally, to Germany, as well as to the Middle East (Lebanon), North Africa (Morocco, Algeria), and Azerbaijan.
After the start of the crisis in Russia in 2014, we were forced to focus on exports to other destinations: North Africa and the Middle East. Morocco, Algeria, Tunisia...
- You only have a range for cars. When do you plan to expand the offer to trucks as well?
- In the middle of 2016 we started to build a new line that would provide oil, fuel, air and cabin filters for the truck segment of the market. Apart from filters, we don't have anything in the truck segment. We will develop this direction first of all, we want to do something with our own resources at first.
We currently have some goods filters in our offer, but very little. By the end of the year, we will have a sufficient supply of filters for trucks.
- Are there any new product groups that will be added in the light-duty category?
- We are thinking about adding brake fluid and windshield wiper blades to the product range. At the moment we can only announce it.
The wiper blades will be 100% available to us, with the best price/quality combination on the market. I can't understand why quality wiper blades from established brands are so expensive. I see the price at which some premium brands buy wipers, and I understand that the price in the price list is formed by multiplying the purchase price by 3, sometimes more!
- Can you voice the percentage of reclamations?
- Strange as it may seem, but the percentage of reclamations from Ukraine is very small. There is a general opinion that in Ukraine, road conditions are bad, in addition to the fact that people often install spare parts for maintenance themselves. I don't know what percentage of complaints are rejected by the distributor, but according to the statistics that distributors send me, the percentage is very low.
Complaints have never exceeded 0.5% in each product group. For some items there are no complaints at all. For the company as a whole, complaints do not exceed 0.15%.
Alexander Kelm interviewed
