Interview with CEO Jos De Vuyst in STERCK. magazine
Just two years after starting a new activity, it is already generating 100 million euros in sales: stow Group is doing it with Movu. After the classic rack builder started with automation, it is already conquering the world with it. Jos De Vuyst is the architect of that story. The successful entrepreneur leads a team of 2,200 people whose products are particularly strong in Europe and the United States.
Jos De Vuyst was certainly not family predestined for entrepreneurship. “After studying civil engineering and attending the Vlerick School, I came on board at stow in 1988. The company was still quite small then (founded in 1977, ed.), which gave me the opportunity to do a bit of everything. Production, finance, sales, two years of Morocco for running the business there… it made sure I got the love of entrepreneurship from then on.”
STERCK. The company has since changed hands several times. What did that mean for you as CEO?
Jos De Vuyst: “Until 2001, stow was a family SME. Then it was taken over by the listed Kardex Group. That lasted until 2013: at that time we did an MBO with the management team, supported by a French private equity. Actually, only since then have I felt like a real full-blooded entrepreneur. The job of CEO in a listed company (De Vuyst worked in Zurich from 2007 to 2013 as CEO of Kardex, ed.) is not at all comparable to what I do now. Back then, my job was very regimented and I had to function within a very strict framework. The quarterly results were sacred and we had to inform the stock exchange and the shareholders at regular intervals. That took a lot of time and money. Since the MBO we are really on a rollercoaster: we can act much faster, have to be less accountable and can really focus on the core business and growth.”
Cost leadership
STERCK. stow can today call itself the European market leader and the global number two. How did you achieve this status?
Jos: “The first reason is that we started to focus very quickly on automation. The factory in Dottenijs, built in 2000, was the first example of this. It was the first such business unit in Europe, we were way ahead of our time and were an example of cost leadership. Meanwhile, we process 320,000 tons of steel into racks every year and have several production sites throughout Europe. These are so well distributed geographically that we manage to get our products to our customers everywhere in an economical and transport-friendly way. The third factor is our European network of 20 of our own sales subsidiaries. Thanks to this approach, we are not dependent on external distributors. Above all, let me not forget our own team. Today, stow employs just under 1,900 people. Their motivation, knowledge and experience are essential to our success story.”
STERCK. In which continents, besides Europe, do your racks score the strongest?
Jos: “An important driver of our growth at the moment is definitely the American market. Since we opened our own sales office there a year and a half ago, we have been growing tremendously there. It must therefore be our ambition to eventually set up a shelving factory there as well.
One of the reasons for our current popularity in the United States is that the market there – like in Europe – is highly regulated. Shelving there must meet strict standards. Moreover, the U.S. is also a very large market, in terms of size we can certainly compare it to Europe. Only the projects there are a lot bigger than in highly fragmented Europe.”
STERCK. You also had a production facility in Shanghai for a while. Why was that closed in 2016?
Jos: “We have gradually experienced that, as a European company, it is very difficult to benefit from Chinese growth. Moreover, the loyalty of Chinese employees is on the low side. In fact, some of them shamelessly copied our solutions, which is also possible due to the lack of regulation. As long as there is no “level playing field” in that area, you cannot compete with other local providers in terms of price. So we no longer focus on the Asian market, although we are still present there through dealers in the Middle East and Australia. In itself, I don’t mind this evolution: it gives us the opportunity to concentrate fully on the European and American markets.”
STERCK. In addition to shelving, how did the idea grow to offer warehouse automation solutions?
Jos: “Actually, as a fairly classic steel processing company that builds racks, it is a feat to succeed in adding a ‘high tech’ activity to the portfolio in barely two to three years. On the other hand, it is also a fairly logical move, anticipating market conditions. Initially, our customers mainly needed conventional shelving, because all operations in their logistics areas used to be done manually. Meanwhile, we have been noticing for quite some time that logistics automation is improving rapidly. This is because it has become increasingly difficult to find “regular” operators, such as forklift drivers or pickers. Moreover, the wage cost of those people is ever higher. The idea of starting this business grew out of market demand. The first Movu customers were therefore stow customers.”
Strict separation
STERCK. The first tokens of the Movu story date back about six years…
Jos: “That was indeed when we received the first requests to create automation solutions for our racks. The first developments date from back then and were aimed at moving pallets within a rack structure. With that automated solution, we are unique. The founding of stow Robotics dates back to 2022, last year we changed the name to Movu.”
STERCK. Why that choice?
Jos: “We wanted stow out of the name, to properly separate the two activities. Meanwhile, a full management team has also been built for Movu, with its own CEO: Stefan Pieters. The two companies have different core businesses, although we obviously enjoy cross-fertilization: Movu could never have grown so strongly without stow’s structure. Moreover, a number of people who used to work for stow have also made the move to Movu. These were mostly engineers who had developed and built shuttles within stow’s womb. That synergy is also what makes the story so great.”
STERCK. Stow’s headquarters remains in Dottenijs, while Movu found a new home in Lokeren. What makes this location so interesting for you guys?
Jos: “This building, formerly owned by DPG Media, served as a printing house for a while. Among other things, Het Laatste Nieuws rolled off the presses here. The building was a godsend for us because it was ideally suited for the integration of an ‘experience center’. Here we can show customers the extensive possibilities of warehouse automation and also experiment to our heart’s content. This is necessary because there is still a lot of potential in the further development of automation. We rent this building from the listed group WDP, which has a strong focus on logistics buildings. From the summer of 2023 we built the experience center and furnished our offices, the opening took place on September 19 of last year. The assembly of the shuttles and robots will also take place there. It is already clear that the choice of this high-visibility location, along the E17, is a hit.”
STERCK. How do you notice that?
Jos: “Tens of thousands of people pass through here every day, and we catch their eye just like that. Moreover, robotics is a sexy sector, especially for young people who have studied to be, say, software or mechatronics engineers. The new building is one of the advantages that have allowed us to strengthen our team quickly and substantially. In just two years, Movu has recruited more than 300 people, and by 2024 there should be several dozen more. I am confident that we will also find those profiles quickly, thanks to our good cooperation with universities and colleges and also because you find relatively few robotics manufacturers in Belgium.”
“The observation that the HR story also runs like clockwork is pleasant and at the same time curious at a time when the labor market is tight. We employ a lot of R&D engineers, project engineers, commissioning engineers (who are responsible for starting up projects all over the world, ed.). They find challenges galore here.”
STERCK. What do you make concrete in Lokeren?
Jos: “This is where we group our R&D, production and sales. We build the shuttles and robots that provide internal transport in (semi-)automatic warehouses. Precisely because this activity cannot be compared to classic racking, it was important to completely separate the two business units. Should the Lokeren site ever become too small to produce all the robotics, it is therefore not an option to start up an assembly facility in one of the foreign stowage facilities. Stow construction is mainly about metal construction, while robotics is more about assembly. In time, however, it is possible that we will start a production unit for Movu in the United States, for example. The robots we make for that market are identical to the ones sought after in Europe.”
Giant market
STERCK. What are the biggest differences between the segments in which stow and Movu operate?
Jos: “Movu operates in the ‘material handling’ market, an industry that accounts for $150 billion annually worldwide, with an emphasis on Europe and the United States. Clients therefore come from all possible industries: everyone who produces and/or distributes needs strong logistical support, with automated or non-automated warehouses. Some outsource their logistics operations to specialists in 3PL (Third Party Logistics, ed.), but for us that makes no difference: it doesn’t reduce inventories, it’s just a question of who manages them.”
“We are talking about two segments that are very competitive, although this is even more the case with stow than with Movu: there are fewer specialists in ‘high-tech’ automation than in classic racking. Movu manages to distinguish itself by robotizing very specific processes, such as moving pallets or ‘bins’ (plastic bins) within a rack, or transporting pallets and plastic bins. In developing this, we were able to benefit from the expertise on this within stow.”
STERCK. To what extent are you surfing the high wave of e-commerce?
Jos: “Online sales are undeniably a major growth driver for all those offering smart solutions for the logistics market. This creates incredible opportunities, but also enormous challenges. The warehouses of e-commerce players are ultimately much larger than those in traditional retail. One can, however, question the sustainability story of e-commerce. Eventually it will be financially and socially irresponsible to have courier services driving around with individual packages. I expect a strong switch to automated, small-scale local pickup points. There is a significant chance that we will also play a role in that transition.”
STERCK. What evolutions can we expect in the coming years?
Jos: “We are already building many ‘dark warehouses’ with Movu. These are warehouses consisting of one gigantic box full of shelves, in which no human being walks around. Everything runs there fully automatically: people are unnecessary, so you don’t even have to switch on lights. We are talking more about large-scale projects, but with Movu we also and especially want to focus on the lower end of the market, by democratizing and making automation of ‘material handling’ accessible to SMEs.”
“The ambition is to significantly increase the accessibility of warehouse automation with modular and scalable solutions. Therein lies a great deal of growth potential. It will enable us to regularly double Movu’s sales in the coming years and make the business even more profitable. We also want to strengthen our market position in Europe and the US with both companies, although we also have to take external factors into account. Just think of the geopolitical situation or the current high interest rates. The latter is currently causing companies to postpone their investment or downsize a bit.”
STERCK. Finally, in full growth stow and Movu, how do you still manage to re-breathe from time to time?
Jos: “I love music immensely, play piano and synthesizer myself. With some friends I am even starting a cover band. Also golf, flying as an amateur pilot and participating in vintage car events are restful. But, in all honesty, stow and Movu remain my biggest hobbies. It is wonderful to be at the helm of these ventures.”