Weru Aktiengesellschaft

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Weru Aktiengesellschaft

Zumhoferstraße 25
Postfach 160
73635 Rudersberg
Baden-Württemberg
Germany
(49) 7183 3030
Fax: (49) 7183 303370

Wholly Owned Subsidiary of Caradon Plc
Incorporated: 1974
Employees 2,084 (1995)
Sales: US$352.74 million (1995)
Stock Exchanges: Stuttgart Frankfurt
SICs: 2821 Polyvinylchloride Resins, Manufacturing; 3089 Plastic Window Frames, Manufacturing; 3442 Metal Doors, Sash, Frames, Moldings, and Trim, Manufacturing; 5031 Windows and Doors, Wholesale

Weru Aktiengesellschaft (AG) is the largest manufacturer of high-end windows and doors in Germany as well as the largest producer in continental Europe as a whole. It makes, markets, and distributes wood, aluminum, and polyvinylchoride (PVC) windows, window units, doors, glass residential conservatories, and related systems and accessories for new homes and the renovation of older buildings. Emphasizing American-style quality control, teamwork, data processing, flexible manufacturing, and creative marketing concepts and technology, Weru by the mid-1990s was offering electronic keyless entry doors, composite window systems, and so many door forms, colors, and materials that customers could choose from more than 70,000 distinct door products alone. With main plants in Rudersberg, Triptis, and Heilsbronn, Germany, Weru maintained facilities and sales offices throughout Western and, by the mid-1990s, Eastern Europe.

Glass, Christian Eppensteiner, and the Window-Maker’s Trade: 1843–1917

In the early years of the 20th century, the Swiss-born architect Charles-Edouard Le Corbusier famously remarked that the history of architecture was largely the story of the window. Perhaps no other architect did more to prove Le Corbusier right than the German architect Walter Gropius, whose design for a light-flooded, all glass-exterior factory in Alfeld, Germany, in 1911 is generally credited with the birth of the Bauhaus movement that later transformed nonresidential architecture. That Gropius was German was perhaps no historical accident either, for since the Middle Ages German craftsmen had contributed much to the development of the glassmaking craft.

In 1843 one such craftsman, Christian Friedrich Eppensteiner, opened a small workshop for fitting windows with glass, a process known as glazing, in Rudersberg, Germany, a small town near Stuttgart. At the time Eppensteiner began his business, the manufacture of windows was in a period of transition. Although early windows had almost all been casements, that is, windows that opened out or in from side hinges like doors, the Dutch had introduced the now common vertically sliding, double-hung sash window around 1680, and it soon became an accepted style.

The biggest change in window design in Eppensteiner’s day, however, was the amount of glass that could be used for the pane. Until the 19th century, the technology of glassmaking allowed only small panes to be fashioned, limiting the size of the average structure’s windows. Improvements in both industrial machinery and glassmaking methods were already altering the window-making craft when Eppensteiner’s first products began to establish his reputation in mid-century. In 1830, an Englishman named Lucas Chance brought home from Germany a new glassmaking technique that represented a significant advance over the traditional method. In this technique, a glass-blowing pipe was dipped into molten glass, extracted, and manipulated into a cylindrical shape. While still hot, the cylinder was then flattened on a sand-covered iron plate and allowed to cool. Chance’s German teachers had discovered that if the molten glass cylinder was allowed to cool, cut with a diamond, and then reheated and flattened on a bed of smooth glass, the surface imperfections caused by the old iron plate method could be eliminated.

By the turn of the century the artisan’s craft of Eppensteiner’s small workshop had evolved into a factory-based—though still labor-intensive—operation. Window panes were still formed from glass melted in large Schmelzofen (melting ovens), from which globules of molten glass were drawn by the glassmaker through a five-foot-long pipe.

A Future for Glass: 1918–54

After World War I, an enormous demand for modest residential homes propelled the window-making industry decisively into the mass manufacturing age. As Gropius and his colleagues were revolutionizing the design of the modern high-rise, new standardized steel windows in a variety of preformed sizes and models were altering the craft of designing windows from an ad hoc art, determined by the dimensions of the existing structure, to an assembly-line industry in which a growing number of new homes were designed to accommodate the standardized windows becoming available. Window manufacturers were also soon delivering not only the window itself to the construction site but also the complete window unit, with casements preinstalled and the fittings already fixed in place.

In the years before World War II, Gropius’s Bauhaus method was leading to dramatic attempts to exploit the light-giving characteristics of modern architectural and window manufacturing technology: entire walls could be filled with a single sheet of glass and even glass bricks began to be used in place of traditional construction brick. Although the sheer number of older residences in Germany’s housing stock ensured that Eppensteiner’s legacy of crafting glass windows to fit the particular dimensions and construction of existing structures would survive, the introduction in the late 1930s of galvanized (dipped in zinc) all-steel window frames further cemented the advances made by the newer technologies.

Roller Shutters, PVC, and the Rebirth of Weru: 1955–88

For all the advances transforming the window and construction industries in general, the family-run, artisan’s approach Eppensteiner had established in 1843 continued to rule his firm even into the postwar years of German reconstruction. New construction materials—from natural or colored aluminum alloys and stainless steel to vitreous enamel—continued to alter Eppensteiner’s ancient craft, however, and knowing that a larger market could be gained if the firm modernized its business, in 1955 the company’s owners reformed Eppensteiner’s family firm as Weru Rolladenwerk (roller shutter works). Like traditional window blinds, roller shutters were often wooden and later synthetic slats that could be closed to protect homes from sunlight, noise, heat loss, and vandalism.

Weru’s reincarnation as Weru Rolladenwerk represented its definitive entrance into the postwar homebuilding industry, and, significantly enough, it occurred just at the time when a new window manufacturing technology was revolutionizing the industry. In the early 1930s, the German industrial giant BASF began producing polyvinylchloride (PVC), or vinyl, a rigid polymer resin that because of its durability and flexibility showed promise for such applications as film, magnetic tape, and electric insulation. PVC was also a perfect material for windows: whereas metal conducted heat or cold transparently, PVC maintained a moderate temperature year-round; while wood rotted and metal rusted, PVC resisted sun erosion, pollution, and rain; and while metal and wood required periodic painting, even when scratched PVC displayed the color in which it had been manufactured.

In 1955, the German company Dynamit Nobel produced the first window system made of PVC, which was followed by the introduction by Fiberlux of the first vinyl windows in North America in 1959. A year later, another American company, B. F. Goodrich, introduced the first PVC storm window. Weru saw the potential of the new material, and in 1960 it also began using Kunststoff —or plastic/synthetics—for its roller shutter products.

Throughout the 1960s, PVC increased its foothold in the window manufacturing industry. In 1963, for example, Fiberlux unveiled a system for mass-producing rigid vinyl window products, by 1964 had introduced its own vinyl storm doors, and by 1967 had developed its first PVC double-hung replacement window and PVC replacement window manufacturing system. With its line of roller shutters thriving, in 1969 Weru itself began manufacturing synthetic windows and window elements, and it completed its transformation from a small “handicraft” supplier to a national industrial operation when the brand name Weru was registered as a trademark in 1969. In 1970 it began a partnership program to build a network of individual businesses identified by its trademark that by 1990 numbered 1,350. Four years later, Weru became a Kommanditgesellschaft, or limited partnership, and established several companies to expand its market reach. In 1975 it branched out again into aluminum PVC windows and by 1979 was manufacturing house doors. By 1985 Weru’s 750 employees were producing 455,000 windows and 8,100 house doors a year, and sales had reached DM 158 million. Window and door production as well as the company’s administration and management continued to be run out of the “ancestral seat” at Rudersberg, but new manufacturing technology was transforming the traditional window-making business. By the late 1980s manufacturing surplus material was being recycled to avoid wastage and reduce costs and computerized systems were used in product design to manage the flow of raw materials (primarily aluminum, plastic/synthetics, and steel), production planning, and the precision machinery that fashioned Weru’s ever more complex product lines. The company also marketed two major lines of security-enhanced aluminum-frame house doors with 2,000 possible design variations as well as a steel-reinforced PVC door.

Company Perspectives:

Form follows function. Doors and windows are by nature products which must be more than simply functional, they must please the eye too. And since the architectural landscape is such a broad field and because tastes must be catered down to the smallest detail, our range of forms, colors, and materials is accordingly wide and extensive. However, despite the subjective nature of aesthetic judgment, our company always puts one principle first: no form without a functional purpose.

A “quality circle” program to increase the quality of its windows and doors through worker feedback had been adopted in 1986, and an educational program for keeping employees up to date in sales, product technology, application technology, and assembly techniques had also become an integral part of Weru’s corporate culture. In 1988 Weru introduced its Weru Partner Software (WPS) program for settling accounts and accelerating accurate cost estimates; by 1991, 70 percent of its sales were being processed on it. Bolstered by a boom in the construction market for new homes in Germany, Weru between 1985 and 1989 saw its annual window and door output rise 26 percent and 36 percent, respectively. More importantly, between 1985 and 1988 sales had vaulted 32 percent to DM 208 million. Weru was now Germany’s leader in the manufacture of doors and windows, with close to 11 percent of the market.

Going Public: 1989–95

In 1989, Weru responded to its new dominance of the German market by converting itself into a publicly owned company, selling 400,000 shares in the “highpoint” event of the company’s long history. Three separate Weru operations—Weru Beteiligungsgesellschaft mbH (a holding company), Weru GmbH & Co. KG, and Weru GmbH & Co. Fensterfabrikations-KG (a window manufacturer)—were consolidated as Weru AG and merged with the window and door export distribution firm TEAM Fenster + Türen of Leonberg. Weru’s sales network now extended from the United Kingdom and the Netherlands to Austria, Switzerland, and France, and 3,500 window units and 60 door systems were being manufactured every day. The fall of the Berlin Wall opened a huge new German market for Weru’s products, and in November 1989 Weru reached an agreement with representatives from the East to develop Weru’s market there. It also began planning its entry into new product areas including “wintergärten” (glass residential conservatories), projecting roof or eave systems, and security systems, among other lines.

With the potentially vast eastern German market now open and with only limited growth opportunities remaining in Rudersberg, Weru built a new facility in Triptis, south of Leipzig, in 1991, and its network of German sales bureaus now totaled 16, with another five international bureaus. With windows still accounting for 89 percent of its sales (windows 11 percent), Weru continued to search for alternatives to the use of PVC, which was coming under increasing assault by environmental groups as a carcinogen. It was also building a reputation for taking on challenging and public-interest projects: for a mountain cable railway station in the Karwendel mountains it transported windows and doors to the mountain site during a blizzard and completed the installation five days later; it delivered and installed windows and doors for a school in mountainous Cuernavaca, Mexico; and it donated windows and facades for the renovation of an historic church in Halbertstadt-Wehrstedt, Germany.

Weru was becoming adept at modern marketing techniques as well, salting the German media with ads, sponsoring sporting events, and participating in industry trade shows. With burglars breaking into German homes at the rate of once every two-and-a-half minutes—usually unimpeded by standard front door locks—Weru’s solid, high-security door designs found a captive audience. Its marketing strategy was also tailored to two other unique aspects of German life: only 40 percent of Germans owned their own homes and when they did buy them typically stayed put for life. Many homes were therefore elaborate and expensive and thus ideally suited to Weru’s range of high-end, customizable door designs. Similarly, in the early 1990s, Germany faced a severe apartment shortage, which the federal government addressed by launching expensive new apartment construction programs. By 1992, Germany was still short about two million housing units, but by marketing to both the new housing market and the renovation market Weru could solidify its share of the German window and door industry.

With Weru pouring investment capital into the Triptis facility, by the end of 1992 its capacity had risen to 2,900 window casements a day, and a new network of suppliers enabled it to pare its inventory to a cost-saving minimum. With its new Triptis facility, sales to the new eastern German states rose 80 percent over 1991, and the company introduced higher-quality colored wood-grain PVC windows and launched a new canopy product line to complement its front door range. In technology, new computer-controlled saws and welding machines were brought on line in Weru’s factories, with their data fed directly to each machine by satellite. And WPS II, an upgraded version of Weru’s sales and administrative support program, was installed and made operational on 344 company systems the same year.

With sales closing in on DM 294 million, Weru celebrated its 150th anniversary in April 1993 by renting Europe’s largest exhibition ship for a four-week cruise, with stops in Germany, France, and the Netherlands. Twenty-five thousand customers, dealers, and guests participated in a floating trade show-cumparty under the banner “Architecture & Living, Weru Visions.” The construction of a new corporate headquarters in Rudersberg was also announced, new subsidiaries were added in Italy, Poland, and Hungary; and Weru Bouwelementen was established in Eindhoven, Holland, as a sales, training, and customer service center. A new acquisition, Selnar GmbH, of Heilsbronn near Nuremburg, reflected Weru’s awareness of the growing demand in Europe for wood architectural products, the second most important raw material for windows after PVC. A new series of pine wood products (“Die Baumfenster” [wood window] and “Die Baumtüure” [wood door]) was launched for the high-end home products industry to be sold through Weru’s specialist dealers.

Other new products were developed internally: the Weru “climate window” used specialized glass that yielded improved energy savings, a new window element featuring an integrated roller shutter and electronic shutter control (“Servo-Lift”), and a new “composite” window that combined the strength of aluminum with the stability and safety of PVC. Weru’s soundproofed, thermally insulated door line now counted 70,000 potential variations, and a new Servo-Lock electronic door locking mechanism that used an identification chip rather than a key offered a further advance in home security. Weru also reorganized its distribution network into seven regions, expanded its WPS II software system, and laid plans for a front door design service, an interactive door selection CD, and a special financing and special event service. At the end of the year Weru founded Weru-VITTON/Warsaw to produce PVC windows and other components in Poland and eventually throughout Eastern Europe. Weru’s physical plant was also improved with an expanded line of wood varnishes, new wood crafting equipment, a more efficient machining center, an expanded glass insulation manufacturing facility, and a fiber-optic-based data network.

Between 1991 and 1993 Weru’s sales had climbed 41 percent to DM 486 million and its stock, roughly half of which was held by non-German stockholders, had become among a select few German stocks rated a “buy” in the world’s stock markets. The first few months of 1994 seemed to promise more of the same. Weru’s new Rudersberg headquarters was opened; it unveiled a house door design service that enabled customers to select three door models and have them superimposed on a photo of their home for comparison purposes; and its new Polish operation, Weru VITTON, was quickly producing 100 window units a day and had been expanded with the acquisition of a Polish plastic window production facility. A new quality and customer-sensitive service program named KLIK was launched, a steel bar reinforced high-security product named Protecdor was introduced, and a new projected-frame window surround that enabled Weru’s windows to be installed in the state-protected historical buildings of the Netherlands was also unveiled.

By the end of the first quarter of 1994, however, Weru’s orders had fallen 10 percent from their 1993 levels. They recovered between April and September, but Weru’s attempts to get its workers (many of whom were Turkish Gastarbeiter or guest workers) to fill Saturday shifts, in addition to a two-shift workweek schedule, was vetoed by their union, and Weru’s order backlog began to expand dangerously. Moreover, the demand for new homes was far outstripping the market for repairing existing homes, which represented two-thirds of Weru’s business and yielded its widest profit margins. Weru’s stock suffered a dramatic drop in price and a subsequent selloff, and at the end of the year Weru’s earnings had increased only about 5 percent—versus the 20 percent most of its shareholders had taken for granted. Although Weru insisted its long-term prospects still looked good, in late 1995 it fired chief financial officer Bernd Grenner as a gesture to shareholders for the company’s disappointing performance.

Caradon plc: 1995–97

Weru officials were still protesting the bad press heaped on their stock when in April 1995 the British conglomerate Caradon plc announced the purchase of almost 25 percent of Weru’s shares, for DM 245 million. Established in 1921 as Allied Tin Box Makers Ltd. and for many years known as Metal Box plc, Caradon’s door and window division produced wood, steel, aluminum, and PVC doors and windows under such brand names as Everest, Peachtree, Better-Bilt, Celuform, Duraflex, Alpine, and Thermal-Gard. The seeds of the deal had been planted five years before when Caradon’s CEO, Peter Jansen, visited Weru’s headquarters and liked what he saw. Announcing that Caradon’s and Weru’s door and window lines were “highly complementary,” Caradon then increased its holdings in Weru shares to 50.1 percent, giving it a controlling interest in Weru’s business. The new ownership meant Weru’s Selnar wood window business would get needed reinforcements while Caradon’s sheer size would result in Weru paying lower raw materials prices.

The German housing market continued to decline in 1996, however, and with its 1995 pretax profits down a full 43 percent from 1994, Weru was forced to announce a restructuring that led to cost-cutting and the elimination of 1,630 jobs. Eager to gain an even firmer hold in the German window market, in September 1996 Caradon increased its shareholding in Weru to 72 percent, giving it complete control of the company under German law.

Principal Subsidiaries

Weru Fenster und Türen GmbH; Weru Beteiligungs-GmbH; Selnar GmbH.; Weru-VITTON Sp.zo.o. (Poland); E.P.E.M. Maschinenvertriebs GmbH; Reform Fenster & Türen Vertrieb GmbH; Weru Bouwelementen B.V. (Netherlands); Weru Building Components Ltd. (United Kingdom); Weru Conservatory Centre Ltd. (United Kingdom); Soproner Holzindustrielle Aktiengesellschaft (Hungary); Weru Magyarország Kft (Hungary); Weru OKNA + DRZWI (Poland).