REWE Group plans to withdraw from bread and baked goods production in the future

The REWE Group has found a sustainable use for the Erlensee site near Frankfurt am Main, which is very well located in terms of economic geography and on which a new meat plant for its own production was originally to be built. From 2028 the company Harry-Brot is expected to produce bread and bakery products in a new state-of-the-art wholesale bakery and distribute them in a fresh concept – also for REWE Group as a customer.

As part of the decision-making process, REWE Group has decided to withdraw from the production of bread and baked goods in the future. The plans that have now begun envisage gradually reducing the production site of the Glockenbrot bakery in Frankfurt am Main over the next three to five years and discontinuing in-house production in compliance with the consultation and participation rights under works constitution law.

In addition, production in Bergkirchen will be sold to Harry-Brot. From REWE Group’s perspective, the family-owned company not only stands for long-term cooperation based on partnership, but also for the highest level of procurement expertise, product quality and technological understanding.

The transaction is still subject to approval by the antitrust authorities.

In the coming weeks, negotiations will begin with the works council. The aim is to discuss the necessary operational changes, including a reconciliation of interests and a social plan, in order to find socially acceptable solutions for the employees at the Frankfurt site. Production in Bergkirchen will continue under Harry-Brot as the new employer.

The Glockenbrot bakery has been part of REWE Group since 1986, the Bergkirchen site since 2010. Around 480 employees work in Frankfurt and around 320 in Bergkirchen.

Detailed analyses have shown that the production site in Frankfurt am Main is exhausted in terms of capacity and space. A new building would be unavoidable. High investments in the three-digit million range would have been necessary in the bread and baked goods sector for new production technologies alone, without taking into account the costs of a new building in Frankfurt am Main. In addition, there are the fundamental limitations of an in-house operation with regard to expansion and customer acquisition.

The Glockenbrot bakery has been an integral part of REWE Group for decades and has helped shape the development of the bread and baked goods division. Our sincere thanks for this. Nevertheless, we have taken the difficult decision to withdraw from the in-house production of bread and baked goods in the future. Expansion in Frankfurt is only possible as part of a new building project. As a product group, bread and baked goods are central and relevant to the further development of REWE Group, which is why we have found the best strategic solution here. This means that we no longer have to have our own production facilities for bread and baked goods, explains Hans-Jürgen Moog, Management Board Member for Goods and Purchasing at REWE Group.

With these two new locations in Erlensee and Bergkirchen, we believe that Harry is very well positioned, to be able to offer the well-known Harry quality and freshness in the south, adds Frank Kleiner, Managing Director Marketing & Sales Department of Harry-Brot.

Clear commitment to the importance of Wilhelm Brandenburg

In the area of meat and sausage production, REWE Group continues to rely on its own regionalized production across six locations with a significantly increased investment volume. The latest building block in the regionalization strategy is the plant in Gäufelden, which has belonged to Wilhelm Brandenburg since October 2021. A regional range is produced there for the stores in the southwest region.

With this decentralized set-up, we are meeting the wishes of both our customers and our REWE retailers. Our REWE service counters as well as the ultra-modern self-service ranges emphasize this competence. We will continue to make targeted investments in this area and, if necessary, open up new fields, emphasizes Moog. In Thomas Winnemöller, the company has brought in a proven expert who, as Managing Director of Goods Production, will drive forward the regionalization of production and the strategic development of Wilhelm Brandenburg.

In terms of corporate strategy, REWE Group no longer understands verticalization – purely in the traditional sense – as the operation of production sites. Instead, the company sees verticalization in the future as a strategy to gain know-how and expertise for the food of the future through targeted investments and partnerships with start-ups.