Prof. Dr. h. c. mult. Reinhold Würth

Chairman of the Super­visory Board of the Würth Group’s Family Trusts,
Honorary Chairman of the Advisory Board of the Würth Group. (Photo: © Frank Schemmann / www.schemmann.com)

Ladies and Gentlemen,
Dear readers,

The Würth Group is owned by the Würth Family Trusts. As Chairman of the Supervisory Board of the Würth Group’s Family Trusts, I have been asked to write an article for the Würth Group’s Annual Report for the 2017 fiscal year.

First of all, I would like to take this opportunity, on behalf of the Supervisory Board, to thank the 74,000 employees of the Würth Group for the fantastic results achieved in the 2017 fiscal year. We were able to set new records with regard to both our consolidated external sales and our operating result, which bears testimony to the fact that, even after being in business for 72 years, Würth remains as youthful and dynamic as ever.

I myself am 82 years old and can look back on my life with a healthy dose of gratitude. I am quite an unusual example in the world of business in the sense that I have been observing, supporting and shaping the development of the Würth Group from day one for more than 72 years now. While our company’s development has certainly been more successful than average, it has taken place in a political and technological environment that has brought more changes and technological advances within these 70 years than in the 500-year modern period that came before them.

My father Adolf set up his screw wholesale business only four weeks after the end of the Second World War. I witnessed this era as a 10-year-old boy myself and can still conjure up vivid memories of that time: On 29 May 1945, I was allowed to accompany my father when he set off from Künzelsau, together with farmer Dümmler, in a cart drawn by two oxen with wooden spoke wheels and cast iron rims to the Arnold screw factory, located 15 km from here in Ernsbach, to buy his very first screws. It was quite an event for me! I then helped my father to fill the shelves in a room adjoining the Schlossmühle (castle mill) building in Kün­zelsau with the screws he had purchased.

As such, I am familiar with the development of the company from day one. Four years later, in 1949, when I was 14 years old, I officially embarked on my apprenticeship with my father, which lasted until 1952. When my father died of a heart attack in 1954, at the age of only 45, I was 19 years old and was very lucky, despite the grief that I inevitably suffered, to have benefited from his comprehensive and stringent teaching and training. With two employees and annual sales of DM 146,000 (1954), I then embarked on the 1955 fiscal year, which I closed with DM 176,000 in annual sales and 20.5 percent sales growth.

The era in which the company was expanding was favorable to its development: The country had been destroyed and endless volumes of fastening materials were required for reconstruction, meaning that procurement was often more difficult than actually selling the goods. In 1962, I set up our first foreign company in the Netherlands, followed shortly thereafter by subsidiaries in Switzerland, Italy and Austria.

This two-man business has since become a major name in the SME segment with more than 74,000 employees, and I must confess that sometimes, when I drive up to the Künzelsau campus in the morning and look across the entire site, I can’t help but shake my head in disbelief at what has become of this small company in just three generations.

Now, as I near the end of my lifetime, I am filled with gratitude that I have been able to support Würth in various positions during my 69th year of service. I would be lying if I did not admit to being just a little proud of what we have achieved, although I know only too well that this development would not have been possible without the faithful and loyal employees who have worked for Würth over the decades – on the other hand, however, I do sometimes wonder whether the company would have achieved as much as it has without my involvement.

I am naturally asked the same question time and again at lectures, events and meetings: “Würth, if you could start over, what would you do differently today?” I then answer: “In fact, there is hardly anything I would change – after all, I have already celebrated 61 years of marriage with my dear wife Carmen and I am grateful to God that he has given us the gift of such a long life together and the stability that continuity offers!

I thank my wife with all my heart for raising our three children, largely single-handedly, and for being at the center of our growing family today, with five grandchildren and one great-granddaughter.

I am writing this essay in December 2017. Germany only has a caretaker government. Extremism (G20 summit in Hamburg on 7–8 July 2017) on the left wing of the political sphere, along with the growing resurgence of right-wing extremist tendencies and the attacks on the unity of the European Union are already raising questions as to what lies ahead in 2018 and the years that follow.

Now, I have also experienced the political development of the Federal Republic of Germany from the very beginning and I am more relaxed about these attacks on the political margins today. When I recall the outrage in the SME segment when Germany instated its first left-wing government, led by Chancellor Willi Brandt from Germany’s Social Democratic Party, back in 1969: People were basically saying that we were all about to be expropriated. When the Green Party entered parliament for the first time, the outrage was on a similar scale. No established political party wanted to even talk to the Greens. In the end, it turned out that the sovereign power, namely the citizens voting in the elections, had made wise decisions after all. The current government crisis will soon be overcome, too, because, with its economic supremacy in Europe, Germany cannot afford to abstain from the decision-making process in the EU or in other bodies for too long.

In any case, the top priority today has to be convincing the young generation, in particular, of the idea of a United States of Europe and allowing the European Union to expand in the manner proposed by the very capable French President Macron, namely to first and foremost arrange for the establishment of a European finance minister and a European financial budget.

Anyone who wants to consider this issue as part of the “big picture” is advised to take a quick look at the past. According to Ms. Google, we had 1,800 different customs and currency areas in the territory of the German Empire back in 1790: So any time you crossed the next bridge, you were practically a foreigner. Bismarck’s wise move to proclaim the German Empire in Paris five years after the establishment of the North German Confederation in 1866 was only possible because he exploited the weakness of the states to the south of the river Main, i.e. Baden, Württemberg and Bavaria, at that time and forced them to join the German Empire. It still took many years for Württemberg, Bavarian and Prussian citizenship to be abolished and for the words “Deutsches Reich” (German Empire) to be printed on our passports despite the existence of the German Empire. It is crazy how history repeats itself: The enemies of the North German Confederation, as well as the members of the resistance movement opposing the founding of the German Empire, cited the same sense of “belonging to one’s homeland” and loss of identity that are being raised as arguments within the European Union today.

In this era dominated by four global power blocs, the US, China, Russia and the European Union, do we really want to risk talking down and destroying this European Union that is showing such amazing development? The individual European states that remain would be mercilessly abused or, in the worst-case scenario, even crushed entirely by the other three power blocs.

The European Union would be left with no other choice but to proceed at different speeds. I believe that the Brexit negotiations, which are proving to be incredibly tedious, are unlikely to result in the United Kingdom maintaining very close economic links to the European Union by signing an EEA-like treaty.

The Visegrád states of Poland, the Czech Republic, Hungary and Slovakia should not veer too far off the path of democracy if they do not want to risk losing billions in payments from EU funds. Incidentally, it is as clear as day how the other three superpowers – the United States, Russia and China – are trying to hinder or block the progress made by the European Union. They do not want the European Union to become a monolithic power bloc of global political importance. Take China, for example: They buy the Port of Piraeus and announce that they want to build a lovely new highway to none other than the Visegrád countries, not without the idea of eroding the eastern flank of the EU and perhaps even repelling the Russian influence. Dear readers, let us now build the United States of Europe for our children and grandchildren – it is the best conceivable way of protecting our homeland in a global context.

But let us return from this world view to the year 2018. All economic researchers expect to see further growth in global trade, including trade within the European Union, meaning that the business outlook for 2018 is, in fact, excellent.

As businesspeople, we are, of course, required to evaluate opportunities and risks, advantages and disadvantages, and take unforeseeable developments into account as well, making our decisions in such a way that, no matter how much we strive to expand, we continue to safeguard the security and survival of our companies and the jobs that they provide. One key motto has accompanied me throughout my life: “GROWTH WITHOUT PROFIT IS FATAL.” This principle has proven its worth, as we have been awarded an A rating by Standard & Poor’s for 22 years now. The most important task facing the Würth management team in the future will still be avoiding risks that are not manageable and at the same time making sure that we do not lose our knack for innovation and risk assessment.

Dear readers, I wish you a happy and successful 2018.

Reinhold Würth