fDi Markets Newswire:

Home / Special Reports / Düsseldorf's subtle charm wins over investors and workers alike

dusseldorfs subtle charm

Not one of the more renowned cities in Europe for culture or tourism, Düsseldorf in north-west Germany nevertheless has forged a name for itself as an FDI hotspot. Wendy Atkins looks at how the city's accessibility, highly skilled workforce and quality of life are drawing in investors from all over the world.

Many cities in Germany and the Benelux countries lay claim to being at the heart of Europe, often due to strong transport infrastructures linking them to the rest of the continent. But the criteria for being judged the go-to destination for FDI are somewhat different. Düsseldorf believes it ticks all the boxes in this respect.

The city is home to a diverse mix of companies encompassing a broad range of sectors such as fashion, advertising, life sciences, law, business consultancy, technology, telecoms, banking, insurance and manufacturing. Its increased focus on digitalisation is matched by a growing start-up sector, inspired by the meteoric rise of locally based travel giant Trivago. The city hosts 9540 foreign firms, with the leading countries being the Netherlands (581), the US (431), the UK (405), China (385) and Switzerland (268). 

Big name draw

“The city is attractive for companies because it doesn’t have a mono business structure,” says Marcel Abel, managing director of real estate agency JLL Düsseldorf. “But it has a host of top international companies in various sectors such as advertising, media, law, DAX [Germany's blue-chip stock market index] and service provision, such as WPP and Omnicom, both of which are global multicorporate enterprises. There’s also Clifford Chance, Hogan Lovells, Linklaters, White & Case, Freshfields and many more of the 'magic circle' of partnerships located in Düsseldorf.”

Hans Van Bylen, chief executive officer of chemical and consumer goods company Henkel agrees. “It is home to many DAX companies, a thriving ‘mittelstand’ [Germany's SMEs], which are the backbone of Germany’s economy, as well as renowned universities and scientific institutions,” he says. The city’s roll call of academic institutions includes 22 universities, including the Academy of Fine Arts and the Heinrich Heine University.

Düsseldorf’s population of about 600,000 is well served by its retail boulevard, the Königsallee (locally dubbed 'the Kö'), the modern Medienhafen (Media Harbour district) and the Old Town, which offers a good range of cultural, food and fashion experiences.

These aspects of city life, together with good connections with the rest of the world and an open and friendly atmosphere, are what international investors and workers say is key to their decision to locate in Düsseldorf.

Easy accessibility

Located at the heart of the Ruhr region of North Rhine-Westphalia, Düsseldorf is the capital of Germany’s largest federal state, and one of Europe’s most important commercial, services and media centres. “Not only has the economy consistently developed in a positive way but the number of employees has increased over the past couple of years,” says Mr Abel. “Düsseldorf has significant advantages in terms of excellent transport connections, such as its airport, which acts as an intercontinental hub connecting the city and wider region with locations around the world.”

Michael Reinartz, director of innovation at Vodafone, says: “The airport has direct links to many locations around the world, and it’s really easy to reach from the city centre by train or car. The railway system is also good, offering connections to leading destinations throughout Europe, including Brussels, Paris, London and Amsterdam, as well as other German cities. And its proximity to Belgium and the Netherlands is a bonus in terms of crossborder business.” 

Düsseldorf airport has a catchment area of 18 million people living within a radius of 100 kilometres. Annual passenger numbers are currently around the 23.5 million mark with an average daily throughput of almost 64,400. There are flights to 200 intercontinental and European destinations, as well as cities throughout Germany, serviced by 70 airlines.

Creative thinking

Düsseldorf has attracted several big names from the creative sector, such as Grey, Bugatti, Breuninger and Gerry Weber. Many have established a base in the fashionable waterside Media Harbour area. Leading the way is Filmstiftung NRW, one of Europe’s largest film funds, with Landesanstalt für Medien LfM, Europäische Zentrum für Medienkompetenz ECMC and the WDR broadcasting centre also setting up bases in the area. 

The fashion industry is important to Düsseldorf, and accounts for 7.6% of its economy compared with 3% in the rest of the country. C&A, P&C, TK Maxx and L’Oreal are among the major firms headquartered here. 

“Düsseldorf is a fashion industry hotspot that attracts international specialist visitors and buyers from around the world, year in, year out,” says Angelika Firnrohr, managing director of the Fashion Net Düsseldorf association. “Whether it is garments, shoes or accessories, Düsseldorf’s trade fairs showcase what will be fashionable for the coming season. Nowhere else in Germany is there the same density of showrooms as there is here. We have 800 exclusive stores that offer domestic and international retail specialists the opportunity to order and sell the latest fashion brands and trends.” 

Grey's bright spark

Düsseldorf is one of advertising agency Grey’s global hubs, alongside New York and London. From its base here it is the global brand lead for companies such as Deichmann and C&A as well as for Boehringer Ingelheim and Grohe. “We first entered the German market in 1953,” says Michael Rewald, Grey's chief marketing officer. “Düsseldorf has always been a key location for us because it is the main city in Germany for marketing spend – even higher than Hamburg and Berlin – plus it has many major companies that require our marketing, PR, branding and advertising services.

“When I started working for the firm in 2002, we had 65 agencies/brands in Germany. We’ve since consolidated that number and now have 10, with Düsseldorf acting as the hub. This makes sense because Germany is such a [relatively] small country and we can fly everywhere from here in one hour.” 

The company employs 350 people in the city with an average age of 36 across the workforce. However, Mr Rewald admits it is not always easy to attract good creatives. “They want to live in Berlin or Hamburg, or if they’re looking on a global level, Barcelona, New York, London or Singapore captures their attention. But once people have visited Düsseldorf and have seen what it’s like in terms of infrastructure, size, value for money and cultural activities – and realise why it ranks well compared with other German cities – they mostly change their opinion and are persuaded to stay."

Links with universities are important for the creative sector, as they are for the fashion industry, in which firms and organisations collaborate with institutions such as AMD Akademie Mode und Design Düsseldorf and MD.H Mediadesign Hochschule Düsseldorf.

Trade fairs add to the city’s international credentials, with local company Messe Düsseldorf claiming to be one of the five most successful organisers of these events worldwide. Düsseldorf’s trade fairs cover a variety of sectors, from beauty and hairdressing to tourism and catering, as well as packaging and engineering.

A history of making

The city has long been a manufacturing centre, and traditional industries now rub shoulders with 21st century companies, including UK handmade cosmetics company Lush, which began production at its new European manufacturing base in Düsseldorf in a 7000-square-metre plant. It employs a workforce of 320 made up of 45 different nationalities.

“Having looked at locations for our newest digital fulfilment and manufacturing facilities in Germany, the Netherlands and France, Düsseldorf stood out as the ideal location for Lush in central Europe,” says Jason Muller, the firm’s global manufacturing director. “With its long history in manufacturing and excellent distribution links to all major markets, the decision was easy in the end. A diverse and beautiful city with quality manufacturing facilities has enabled us to build the new team very quickly, with many staff relocating to Düsseldorf to help make this exciting opportunity a success.”

At the other end of the production scale is manufacturing giant Henkel, which has been headquartered in the city for 140 years. Mr Van Bylen says even back then the city was an attractive location for a fast-growing company, offering space for future expansion and good transport connections with the railway and nearby river Rhine. He adds: “Today, more than 5000 people from more than 60 nations work for Henkel Düsseldorf – in R&D, supply chain, marketing and management functions. It is our largest production facility worldwide and a global centre for R&D across all our businesses, ranging from adhesives technologies to beauty care as well as laundry and home care.”

Henkel is expanding its fully automated warehouse for the latter to the size of two football fields with capacity for more than 25 million packages. “We also have one of our largest test salons for hair care, where we explore new hair colour and styling products,” says Mr Van Bylen.

This article is sourced from fDi Magazine
fDi Magazine

The fDi Report 2018: Free Download

The fDi Report 2018 promobox

Crossborder investment monitor

fDi Markets - Cross border investment monitor

fDi Markets is the only online database tracking crossborder greenfield investment covering all sectors and countries worldwide. It provides real-time monitoring of investment projects, capital investment and job creation with powerful tools to track and profile companies investing overseas.

Click here to find out more about fDi Markets

Corporate location benchmarking tool

fDi Benchmark is the only online tool to benchmark the competitiveness of countries and cities in over 50 sectors. Its comprehensive location data series covers the main cost and quality competitiveness indicators for over 300 locations around the world.

Click here to find out more about fDi Benchmark

Research report

fDi Intelligence provides customised reports and data research which deliver vital business intelligence to corporations, investment promotion agencies, economic development organisations, consulting firms and research institutions.

Find out more.