As the fortunes of what now is called the Czech Republic waxed and (mostly) waned over the last hundred years or more, so did those of most of its domestic companies. To no one's surprise, many of those founded during Hapsburg rule did not weather the empire's collapse after World War I or the subsequent political storms that blew in years later from Germany and Russia.
One that did is Agrostroj Pelhrimov A.S., which has made farm machinery and equipment since 1886. The country's only such manufacturer, Agrostroj as an enterprise likely prospered during the interim between the world wars when the new Czechoslovakia reportedly was among the world's 10 richest nations. Nazi and Soviet domination would have hindered operations, but the latter's oppression ended in 1989. If anything, in the last few years, Agrostroj (pronounced agro-stroy) has been its own worst enemy. Its products are distributed all over Europe, North and South America and Asia Pacific. But continued production growth was halted by inadequate warehousing management.
A private company, Agrostroj Pelhrimov's product line includes rotary mowers, mulchers, forage harvesters, milking machinery and manure spreaders. It estimates that 20 percent of its production comprises machinery under its own name, with another 13 percent comprising tool engineering. The vast majority of its output, 67 percent, consists of cooperative projects with the agricultural divisions of some of the biggest companies in the field: Claas, Krone, Pottinger, DAF, Volvo, Jungheinrich, Mitsubishi and Caterpillar.
With its sales opportunities continuing to expand, not the least of which with buyers in the emerging Central and Eastern European nations, in 2004 Agrostroj built a 25,000-square-meter warehousing and manufacturing facility. Located in Pelhrimov, about 120 kilometers east of Prague, the warehouse by itself is 3,000 square meters. It didn't take outside consultants, however, for company management to realize that it had simply maxed out on its ability to feed its production lines. Its slow and error-ridden warehousing operation not only couldn't meet orders from the production floor timely and accurately, it was an anchor on any attempts to meet growing customer demands.
|"The operations created problems not only with existing production lines, they halted the development of any new production lines."|
- Alex Pavul of Radio Beacon
|Agrostroj Pelhrimov at a Glance|
|The company: The only producer of agricultural machinery in the Czech Republic, Agrostroj is a joint-stock company with no state-owned shares or foreign capital. |
It manufactures agricultural equipment under its own name and parts for agricultural divisions of major manufacturers, such as Caterpillar, Mitsubishi, Volvo, DAF and Jungheinrich.
Headquarters: Pelhrimov, Czech Republic
Number of employees: about 900, 89 percent of whom are engaged in manufacturing.
Financial results: Agrostroj reports an annual turnover of 37m euros (about US$47m) with an average annual growth of 5 percent.
Supply chain challenge: Its manually-operated warehouse was slow, had an extremely high error rate and could not meet the production floor's orders much less accommodate expanding production lines to meet customer demand.
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