Digital Supply Chain (DSC)
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Logistics location Germany Between pressure, dynamism and new strength
Germany too expensive, too slow, too inflexible? The panel discussion at the IGZ Innovation Days 2025 paints a different picture - and this surprises many. The logistics location is ailing, but far from being knocked out. In fact, a new type of logistics location is currently emerging here: automated, digital and knowledge-driven.
Read our new blog post to find out why companies are consciously investing in Germany despite all the challenges.
A location under pressure of expectations and of strategic importance
As a logistics location, Germany is caught between aspiration and reality. Companies demand stable supply chains, high service levels and reliable framework conditions. At the same time, infrastructure deficits, high energy prices, a shortage of skilled workers and geopolitical risks are putting pressure on the quality of the location.
This ambivalence was clearly noticeable at the IGZ InnoDays. Manufacturers, logistics managers and SAP as a global software provider shed light on different perspectives - and yet there was a consensus: Germany remains a decisive, strategic logistics location that needs to reinvent itself.
After all, global competition is no longer just about costs, but also about resilience, quality and future security.
Advantages & challenges: Where Germany shines - and where it struggles
Anyone talking about Germany as a logistics location quickly recognizes the contrasts.
Manufacturers such as Geberit, Rehau and the bilstein group openly emphasized the weaknesses: high costs, limited space, congested transport routes, increasing regulation and growing difficulties in recruiting skilled workers. Above all, the infrastructure - the backbone of logistics - is under pressure in many areas. Its modernization remains a key national task.
From the perspective of the software company SAP, there are further aspects to consider:
Global competition for talent, the pressure to shorten innovation cycles and the need to anchor AI, cloud and automation expertise worldwide.
The strengths - often underestimated
But the strengths are just as clear - and often underestimated: a central location in the middle of the world's largest economic area, dense transportation networks, a strong industrial base, experienced logistics service providers and decades of process and system expertise. The stable legal and planning system also plays an important role for global companies.
What seems paradoxical at first glance becomes apparent at second glance: Location decisions today are less a question of cost and more a question of overall performance.
Why companies are deliberately staying in Germany
The motives differ depending on the industry - and were clearly recognizable during the panel discussion.
Manufacturers: proximity, logic and risk minimization
Three factors predominate for production companies:
- Proximity to the market: central European customers expect fast delivery.
- Transport logistics: Large-volume or high-quality products cannot be delivered economically from Eastern Europe or overseas.
- Service requirements: Same-day services or precise construction site windows can only be realized from Germany.
- Resilience: A second location in Germany increases reliability and capacity.
Many companies put it bluntly: The advantages of the location beat the challenges - hands down.
Software companies: Expertise, talent and globalization
SAP, on the other hand, takes a global, knowledge-oriented perspective:
locations are created where talent is available - not where costs are minimal.
A pithy sentence from the panel sums it up: "We are where the knowledge is - not where it is cheapest."
For SAP, Germany is not a production location, but a competence location - and this knowledge is in demand worldwide.
Another key learning from InnoDays: globalization cannot be stopped.
Location decisions are becoming more differentiated, not more binary. Germany maintains its role where quality, expertise and reach are decisive.
Automation & digitalization: the decisive game changer
There was complete agreement on one point - across all sectors: automation is the prerequisite for logistics to work in Germany.
Manufacturers reported very specifically:
- AMRs take over heavy load transports that previously had to be controlled by employees at cranes.
- AKL, MFS and EWM enable high throughputs in a small space.
- Automation relieves the burden of monotonous and physically demanding tasks - a must in view of the shortage of skilled workers.
Or as the bilstein group put it: "Without automation, we would never have been able to build our new logistics center in Germany."
For SAP, automation is part of a global digital transformation. AI, SAP TM, SAP EWM, S/4HANA and SAP Digital Manufacturing create standardized, scalable and transparent processes that work worldwide and can withstand labour market bottlenecks.
This makes automation a basic technology for every location, rather than a nice-to-have solution.
Outlook: What will strengthen Germany as a business location in the long term?
A key statement from the discussion was: "Globalization cannot be turned back - and it cannot be stopped." This makes it clear that Germany must adapt, not isolate itself.
The future depends primarily on three factors:
- Automation as a basic technology
Those who automate reduce costs, increase quality and reduce dependencies on the labor market. - Digitalization as a control instrument
Continuous data flows - from the supplier to the customer - are necessary to make complexity manageable. - Knowledge & education as a location factor
Innovation originates in the mind. Germany's advantage remains its density of expertise - but it must be cultivated, expanded and opened up internationally.
Germany will not become a low-cost location. But it can become Europe's high-performance logistics location - if the course is set today.
Strengthening Germany as a business location with IGZ
The IGZ InnoDays have shown that technology is not just a tool, but also a lever for a resilient, efficient and sustainable logistics location in Germany.
IGZ supports its customers in this,
- design modern logistics processes,
- setting up automated sites,
- implement intelligent SAP solutions,
- and mapping digital supply chains end-to-end.
Whether SAP EWM, SAP MFS, SAP TM or SAP Digital Manufacturing - IGZ implements solutions that compensate for location disadvantages and open up new strengths.
Would you like to make your location more efficient, more resilient and more digital?
Contact us - together we will turn your location into your competitive advantage.
We look forward to hearing from you!
