Hellmann Worldwide Logistics announced that it has signed a 10-year business agreement with the German STIHL Group.

As part of the deal, Hellmann said it will take over the warehousing of finished goods for STIHL effective mid-2022.

"To meet STIHL's high requirements from one single distribution center, Hellmann will be leasing a highly modern finished goods warehouse in Völklingen, Germany, allowing for a strategically optimal geographical location," the global logistics provider said.

It added that the new facility is slated to be completed by mid-year and on January 1, 2023, the central warehouse will go into full operation as a single-user location for STIHL.

The logistics center is situated at the trilateral border of Germany, France, and Luxembourg.

The STIHL Group develops, manufactures, and distributes power tools for professional forestry and agriculture as well as for garden and landscape maintenance, the construction sector, and private garden.

"The new central location will allow Hellmann to develop an efficient and highly flexible supply chain leveraging a well-connected express and courier service provider network, supported by the ability to take advantage of its own Road & Rail subsidiary in Neunkirchen just 40 km away," Hellman said.

It added that the site also features a sustainable building design as well as state-of-the-art warehouse and picking technologies, such as self-propelled picking equipment and smartwatches.

The 58,000 m² logistics center, which includes about 3,000 m² of mezzanine space and 1,600 m² of office space, can be expanded, at a later stage, by an additional 30,000 m² of logistics space to accommodate future volume growth.

"We are very happy that the STIHL Group has chosen Hellmann as its long-term logistics partner to implement its growth strategy in the European market. The recent closing of this decade-long contract is a testament to the trust that STIHL has in us," said Volker Sauerborn, COO, Contract Logistics for Hellmann Worldwide Logistics.