Company Report: Grundfos

Grundfos Magna Glandless circulator pumps

Grunfos Head Office

Grundfos BioBooster

Grundfos is an international company and is recognised as a world leader in the design and manufacture of pumps for many different applications. It produces an annual global output of around 16 million pump units and invests millions in research and development (R&D) each year.

Global demand for its products is huge. And, to meet it, Grundfos has had to create many sales and manufacturing facilities throughout the world; in fact, it has 82 companies in 45 different countries. It is a big company, operating on an international scale.

“Grundfos is one of the world’s largest pump manufacturers, making pumps and systems for heating and air-conditioning, industrial applications, dosing, water supply and wastewater,” says Jim Rise, Business Development Manager. “The company’s products include circulator pumps, submersible pumps, and centrifugal pumps, and we provide electric motors and electronics for the pumps and other systems.”

Grundfos was founded in 1945 and is based in Bjerringbro, Denmark. Today, it is, says Rise, “a world leader in high-tech pumps and pump systems and one of the world’s largest manufacturers of pumps.”

MARKET POTENTIAL
According to Rise, despite the recession, and global financial turbulence, there is still a growing requirement for clean water and the disposal of wastewater worldwide.

“The world’s population tripled in the 20th century,” he says.

Within the next 50 years, the world population will increase by another 40 to 50 percent. This population growth - coupled with increased industrialisation and urbanisation – will result in increased demand for water and will have serious consequences on the environment.

“We will see an increasing demand in growing economies, which are looking for that western lifestyle,” says Rise. “Plus, many of the developed economies now play host to aging water systems that will need increasingly sophisticated technologies. Already there is more waste water generated and dispersed today than at any other time in the history of our planet.”

Markets of interest include Russia, China, and other growing economies across Asia and Africa, where agriculture and industrialisation are big business. “It is now all the more critical that increased water use by humans does not reduce the amount of water available for industrial and agricultural development,” says Rise. “We are playing a significant role in that.

“We expect China to be a huge market in the future,” he adds. “We are scaling-up production there, in fact. We have a 60,000 square metre production facility in China at the moment and it is operating at full capacity now. So we will have to expand in the future.”

NEW PRODUCT DEVELOPMENT
Like many others, Grundfos has been hit by the general economic recession in connection with the global financial crisis. But through targeted and careful efforts in the group, it has succeeded in getting through the crisis. Despite this, Rise told us that profit is far from the group’s long-term aims. “We did not reach the growth of recent years in 2009, but are well-placed for the future and, of course, are focused on R&D.”

Last year Grundfos invested a whopping £70 million of its turnover in R&D, which enables the company to continuously launch new and updated products – a goal much more important to Rise than profit. “One of the main areas of R&D concerns the improvement of energy efficiency,” he says. “And, given the record demand for energy worldwide and the effects of pollution on climate change, greater energy efficiency is a growing requirement among pump users.

“It is estimated that pumps account for about 20 percent of the world’s power consumption and by enhancing the energy efficiency of its pumps, Grundfos can help save power,” he adds.

Another targeted area is leak reduction. Rise says something like 32 billion cubic metres of drinking water is leaked every year globally, which is simply astonishing. “We have been developing solutions that manage water pressure and can adjust pressure depending on demand,” he says. “We have a fully integrated turnkey unit that offers maximum performance, but varies the flow and pressure according to demand. The advantages include cost reduction, energy loss reduction and water loss reduction.”

He believes the market for this product is huge. “It has big potential in places like the UK, Hungary, Romania and Italy, where leaks are a major problem and where infrastructure is old,” Rise says, talking about the revolutionary system that eliminates surplus pressure, reduces leaks and reduces water hammer.

INNOVATION
It’s hard to overstate just how important innovation is to Grundfos. It is central to everything. The company’s target is that all new products developed must consume less energy than previous models.

In addition, new products are developed to consume less material than previous models. And generally, says the company, between 90 percent and 99 percent of pumps can be recycled after dismantling.

“Grundfos continuously strives to meet future challenges within the areas of climate change, the environment and energy and wants to make a difference by using its competences to develop trend-setting and high-technology solutions,” says Rise, quoting what sounded very much like a company mission-statement.

“We recognise that there is an increasing need for clean technology and the provision and purification of water in a globalised world, where economic growth is rapid,” he adds.

Pumps aren’t all though. In addition to pumps, pump systems and advanced technology, Grundfos has developed a number of ground-breaking technologies within a sustainable perspective, including Grundfos NoNOx which reduces air pollution, Grundfos BioBooster, which cleans industrial wastewater, and Grundfos LifeLink, which is a solar powered water treatment unit for drinking water in the poorest parts of the world.

“Continuous improvements are essential for Grundfos,” says Rise. “Nothing is sufficient; everything can be improved. Our vision is for long-term innovation,” he continues, as if to stress the point. “Grundfos has an Innovation Intent for 2025, which outlines a global group with 75,000 employees, where one third of the turnover is generated from products other than pumps.

“Pumps will remain Grundfos’ core business and it will continue to develop new sustainable technologies in the area.”

Grundfos has changed as the world has, but its fundamental values, ‘Be responsible,’ ‘Think ahead’ and ‘Innovate’ have remained constant: that’s what the company was founded on, and this philosophy will continue a long way into the future.

“We are in a strong position for the future, already dominating the market,” says Rise. “The big development going forward will be decentralised water systems, which are more responsive to users and more resilient to things like natural disasters. Decentralised systems allow smaller sewers, staged development, smaller consequences of failure.

“Of course, we will be ready for that or any development,” he adds. “Grundfos has a very efficient supply chain and great relationships with vendors. But our plan is to build more intelligence into the system in a bid for continual improvement.

“Grundfos emphasises the importance of good relationship with suppliers to ensure safe and stable supplies of high-quality materials,” he continues. “Each year we award a supplier for having lived up to the company’s expectations – The Grundfos Supplier Award. The winner is a company that has exceeded expectations and contributed to bringing Grundfos into the World Class ‘bracket’.”

The last winner of the award was British-based Morgan Advanced Ceramics Ltd.

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