Local maritime cluster gets boost as Norway’s Dokka Fasteners expands manufacturing base to Klaipeda

Norway-based Dokka Fasteners, part of the multinational Würth Group, manufactures top-quality, high-tensile fasteners used in demanding industrial applications. Its market includes wind turbines, where it supplies components for everything from foundations to towers, cells and blades; oil-and-gas and other offshore applications; and heavy machinery including cranes and steel constructions.

Supply chain constraints

While considering its strategy in the wind-energy market, Dokka Fasteners faced a challenge in that its manufacturing centre in Norway is having constraints in the supply chain due to distance to key customers and raw material suppliers.

"Our competitive market has a lot of price pressure, so we wanted to improve our supply chain by expanding our business closer to customers and raw material suppliers,” says Birresborn. “We were also struggling to fulfil certain orders in Norway due to high costs. At the same time, competitors were entering the market with products at prices we couldn’t match. We wanted to establish a new plant elsewhere for more standardized products with less complex production than our fully robotized plant in Norway. We simply wanted to open new markets from a convenient and cost-effective location.”

The company set about exploring its options against a list of key criteria. “The location had to offer a business-friendly environment with minimal red tape, as well as easy access from Norway and Germany. It had to be close to a port to import raw materials and ship out heavy products. We were open-minded, but our preference was for a location in the EU and the eurozone that offers a local talent pool plus suitable available premises,” says Birresborn.

Winning credentials

Dokka Fasteners considered as many as 15 locations in Asia, eastern and southern Europe as well as the Baltics. Klaipeda and similar port cities like Gdansk were on the radar from the outset.

“We opted for Klaipeda because it has everything we need. Lithuania is in the EU and the eurozone. It’s also in the top 10 countries worldwide in the Ease of Doing Business index. I can certainly say setting up our local joint stock company went very smoothly. In addition, there are a lot of young people with good skills who speak excellent English,” says Birresborn.

He adds that Lithuania has good infrastructure, including the efficient port at Klaipeda. “The country is very eager to develop versus other countries in Europe at the same level, but where things seemed have stopped up. It is pushing to get better all the time, which mirrors our own philosophy.”

Culture was another deciding factor. “The Baltic states are historically closely aligned with Scandinavia in terms of values, which makes teamwork and dialogue easier. Klaipeda also satisfied our travel criteria as the international airport at Palanga makes it easy to get to,” says Birresborn.

Collaboration potential

Forging deeper connections with Klaipeda’s established maritime cluster will undoubtedly be beneficial for Dokka Fasteners in future. “We haven’t yet taken advantage of local academic institutions for R&D purposes, but I believe there’s good collaboration potential there too,” says Birresborn.

Dokka Fasteners elected to start out by renting premises while it proves the business case for the new operation. “Lithuania is very strong in logistics and there is plenty of that building stock, not so many production-oriented sites. We looked at many locations and finally found one that met our high standards. It required some additional investment for modifications and now we have three production cells, one robot-operated. Maybe in five years’ time we will consider building a brand-new factory from scratch,” he says.

Contributing to local economy

Birresborn notes that in Lithuania it is easy to find mid-skilled administrative personnel, for example purchasing and sales, but more complicated to find highly skilled professionals like electricians, engineers and so on. “It has the same trade skills shortage as all other European countries, but we did manage to find the required profiles both on our own and with help from recruitment consultants,” he says. “We now have 22 full-time local employees and plan to employ up to 50 people over the next three years. Our intention is for the plant to become a part of an efficient supply chain catering to the global market and we have clear ambitions to grow.

He warmly recommends Klaipeda to other Norwegian maritime equipment suppliers looking to expand to an attractive location with an attractive cost base. “Adding jobs strengthens the local economy so we are actively contributing to local society,” he says.

‘Quite an achievement’

Birresborn sums up that everything has gone to plan to get production up and running. “I’m proud of how quickly things progressed. We set up the company in February, moved into the factory in March and shipped our first orders to customers in May. That’s quite an achievement. I also believe that key in this was the good cooperation between the headquarters in Norway, our Danish Dokka Fasteners entity and the newly founded company in Lithuania. All in all, we’re very happy and the support of Klaipeda ID has been invaluable.”

He has also been impressed by Klaipeda as a place to visit. “It's on the coast with plenty of nature around. As a midsize city everything’s on your doorstep, but it depends on what you’re looking for of course.”

Diana Manko, Head of Business at city development agency Klaipeda ID, concluded: “Wind energy is rapidly expanding worldwide and is already the driving force for our national renewable energy goals. As a new member of this ecosystem, Dokka Fasteners proves once again that Lithuania offers an excellent business-friendly climate. Their presence can potentially open the door to further development of the wind-turbine supply chain. I am delighted they chose to expand to Klaipeda.”

Maritime stakeholders interested in finding out more on doing business in Klaipeda should get in touch with the Klaipeda ID team for a free e-consultation. Please visit www.klaipedaid.lt for contact details.