Despite wavering investments in Bulgaria in recent years and the weak economy in Europe one company is significantly expanding its business in this country. Switzerland-based dormakaba, which has been manufacturing automatic doors for 30 years through its local subsidiary, dormakaba Bulgaria, plans to double its space with a new factory and add two new activities. Recently, a business services center has opened in Sofia to serve the group's subsidiaries across Europe. In the same building, an engineering hub has been also established to develop products for all of the group's markets. The investment in these projects has not been specified, but it is clear that the team of 260 people will grow, with many of the new positions related to engineering and professional services. In connection with these new functions a new company, dormakaba Business Services Bulgaria, was spun off from the manufacturing company dormakaba Bulgaria at the end of last year.
One of three worldwide
The business services center is currently planned to operate in the fields of finance and human resources. It will provide services to dormakaba companies across Europe and will be one of the group's three main centers globally. The other centers are located in Nogales (Mexico), serving the Americas, and in Chennai (India) for the Asia-Pacific region, with a smaller center also operating in China. Currently, the business center in Sofia covers five European countries but its scope will gradually expand.
The use of shared services is generally a new activity for the group and is part of efforts to increase efficiency and productivity. For dormakaba, the decision to place the European center in Bulgaria seems logical. "Obviously, Bulgaria is a popular market for shared services, for business services in general. We have seen a huge interest in this type of business for many years and Bulgaria has proven that this is a very beneficial place to build such an organization," says Randy Rosseel, head of finance dbs Europe. According to him, lower labor costs here remain an advantage but they are not the main driver. "I always say we come to Bulgaria because of labor arbitrage, we stay in Bulgaria because of efficiency," he added.
Working on global projects
The company has also created a global engineering hub that deals with product development, software engineering and testing, which operates as part of dormakaba Business Services Bulgaria. According to Magin Guardiola, chief innovation officer at dormakaba International Holding, Bulgaria competed with 13 other sites for the engineering center. "We selected Bulgaria as a highly competent and competitive country," Guardiola says.
The center will develop products for the group globally. Currently, for example, engineers in Sofia are working together with their colleagues in Canada on a project for the American market.
Manufacturing in Bulgaria
dormakaba has a long history in Bulgaria, where it started production in 1994. The factory is currently located in Druzhba district in Sofia and manufactures revolving and sliding doors for the European market. However, the capacity there is now fully utilized. "We receive very good feedback from the market and volumes are increasing. It is a fully loaded shop already, so we do have an issue regarding space," says Marc Artmeyer, senior vice president operations hub Europe.
That is why the company has decided to build a new factory in the nearby town of Novi Han and move production there. dormakaba Bulgaria will have double the space there - about 22,000 sq. m. Construction of the factory is currently underway and production is expected to begin at the end of September. "That will allow us to expand our business in Bulgaria but also to optimize our production network overall," Artmeyer added. The new facility will allow for optimization of material flows and industrial processes and production will be partially automated.
"Our markets are mainly in Western and Central Europe, but also, of course, Bulgaria and neighboring countries," says Vladimir Atanasov, deputy vice president Southeast European market. He explains that the company does not offer standard solutions: each door is tailor-made and represents a comprehensive solution of hardware and software. The main clients are construction companies, property developers, many retailers and installers.
dormakaba group had a revenue of 2.8 billion Swiss francs (around 2.9 billion euro) for the financial year 2022/23. The last published report of dormakaba Bulgaria for 2022 shows a turnover of 37.2 million levs (19 million euro), up 10% year on year.
Despite wavering investments in Bulgaria in recent years and the weak economy in Europe one company is significantly expanding its business in this country. Switzerland-based dormakaba, which has been manufacturing automatic doors for 30 years through its local subsidiary, dormakaba Bulgaria, plans to double its space with a new factory and add two new activities. Recently, a business services center has opened in Sofia to serve the group's subsidiaries across Europe. In the same building, an engineering hub has been also established to develop products for all of the group's markets. The investment in these projects has not been specified, but it is clear that the team of 260 people will grow, with many of the new positions related to engineering and professional services. In connection with these new functions a new company, dormakaba Business Services Bulgaria, was spun off from the manufacturing company dormakaba Bulgaria at the end of last year.