In theory, the advantages of freight villages are undisputed. But what about in practice? We asked umbrella organization DGG whether the common arguments in favor of freight villages actually pay off for businesses, and if so, how? Managing directors Steffen Nestler and Thomas Nobel didn't have to think twice.

The division of labor and trends toward outsourcing in industry and commerce require modern and innovative logistics structures that can be ideally established in a freight village.
The Berlin West Freight Village in the municipality of Wustermark is considered an important logistics cluster for retail supply in Germany. The drugstore company dm, which is based there, was awarded the prestigious BVL Logistics Prize in 2020 for its “Integrative-Intelligent-Automated” logistics concept. With its automation technology, dm has created sustainable logistics processes from delivery by their industry partners, to processing in the distribution center, all the way into dm stores. Every third store receives individually packed pallets from the distribution center in the freight village that correspond as closely as possible to the route the goods will take to the shelves. Having consciously opted for the macrologistical advantages a freight village offers, dm is one of Berlin West Freight Village’s biggest investors with 16.2 hectares of floor space.

Freight villages offer medium-sized companies in particular the opportunity to meet market requirements in cooperation with partners.
The “Urban-BRE Electromobile Citylogistics in Bremen” project (www.urban-bre.de) is a good example of cooperation between companies in freight villages. In this case, the partners are Hellmann Worldwide Logistics, BHS Spedition und Logistik GmbH, and Rytle GmbH. Since fall 2019, the city center of Bremen has been supplied directly from the Bremen Freight Village via a microhub using electrically-powered cargo bicycles. The goal is to reduce the number of delivery vehicles and stops. CEP and forwarder shipments can be transported via this system. This example shows that the proximity of companies in a freight village demonstrably leads to agglomeration economies.

The option of alternative modes of transport increases entrepreneurial flexibility and sustainably ensures the quality of logistics services.
The local paper industry (UPM Nordland Papier) in particular makes use of the intermodal transport options by rail and waterway offered by Emsland Freight Village. Cellulose, for example, is mainly imported by barge from the western ports and Eemshaven. The same applies to paper exports, which are also handled via the Bremen ports. Paper is exported to southern Europe too, for example, by rail via Ludwigshafen.

Cooperative purchasing and resource pools generate direct cost savings for participating companies.
Cooperative purchasing and shared resources are part of the DNA of the freight village concept in Germany. However, experience shows that it is actually only in individual cases that this is a daily reality. One of these cases is Bremen Freight Village. Here, for example, a framework agreement was concluded with the local energy supplier in the 1990s that led to considerable savings for the companies at the freight village. Another “classic” of resource pooling is foregoing individual company gas stations – instead, they all use one service area located at the heart of the freight village. There is a winter cleaning service, which is organized centrally by the freight village development company. Storage capacity is made available on a temporary basis, special forklifts and similar equipment are shared. And the companies in the freight village share a lot of information on logistics-related professional training.

Freight village management supports the companies located there by providing expert guidance and assistance in the development of new product ideas.
The fact that a multi-user hall for logistics companies has been built in the Freight Village Wilhelmshaven is due, among other things, to the impetus and commitment of the freight village management company. Peper & Söhne Projekt GmbH, one of the companies operating in the freight village, took sole responsibility for the construction of the multi-user hall under the “Atlantic One” project. The aim was and still is to create space for companies looking for a flexible logistics location in the direct vicinity of the port that offers smaller storage areas too. “Atlantic One” is now fully occupied. The multi-user hall is a good 10 meters high and covers 12,400 square meters.

Options for expansions and/or areas for large-scale logistics facilities
The continuing demand for large commercial sites is presenting many freight village developers with major challenges. However, the shortage of space in metropolitan areas such as Greater Berlin is also bringing other locations into focus – such as the Frankfurt (Oder) Freight Village. It is not only since Tesla announced they were moving in that the logistics real estate developer Alcaro has occupied a 37-hectare site of the multi-location freight village with direct freeway access, based on their positive experience with the “LogPlaza” in the Großbeeren Freight Village. There is no doubt that the commissioning of the Tesla Gigafactory will provide further tailwind for the project on the Polish border. The trimodal Schönefelder Kreuz Freight Village in Königs Wusterhausen will also benefit from Brandenburg’s development into an automotive region. It is already integrated into the network of the intermodal operator Metrans and is currently developing around 6 hectares of land reserves for further occupants.

Freight villages offer an interface between modes of transport and optimal conditions for establishing intermodal transport chains.
Freight village locations are well established in the combined transport market and most have handling facilities with a high capacity. For example, one of the best used combined transport hubs in Germany operates at the Port of Nuremberg Freight Village, which serves a large number of providers in seaport-hinterland and continental transport. The combined transport terminal at Herne Freight Village has become a hub for European trailer traffic and is currently creating new parking space. The City-Freight Village Berlin (Behala) supplies and collects waste from sites close to the city center by rail and waterway. And LIT Speditions GmbH and Captrain Deutschland GmbH supply Volkswagen’s Emden plant with vehicle parts by rail via the Smartrail Logistics joint venture. For this purpose, the quantities previously transported by road from suppliers in the north of the Czech Republic, southern Poland, Saxony and Thuringia are collected at the Dresden Freight Village. The partners also hope to offer the concept on other routes and as open trains for several customers.

Freight villages offer a potential workforce for the logistics industry.
At several freight villages, the concentration of logistics-intensive companies, for example from the automotive and supplier industries, as well as online retailing, has led to a significant improvement in public transport services, with timetables adapting to shift times and the provision of shuttle buses to nearby regional train stations. Examples of this are the freight villages in Berlin-Süd/Großbeeren, Bremen, Erfurt and Leipzig. Good public transport connections enable companies in the freight villages, which are usually located on the periphery, to attract workers without their own cars or for part-time work.

The overall benefit of a single freight village can only be considered in isolation to a limited extent, but increases with the number of additional freight villages that cooperate with each other at various levels.
The advantages of networking are particularly evident when newer freight villages benefit from the experience and business potential of the established ones. One example of this is the Wilhelmshaven Freight Village: the site at Container Terminal Wilhelmshaven makes targeted use of the freight village network to establish new combined transport links and to attract further businesses. They also run the event series “Port meets mainland”, and other bilateral activities with freight villages in the hinterland. If logistics companies have premises in several freight villages, they can even benefit from indirect networking for their branches because combined operators integrate the locations into their networks.

High degree of certainty for companies in planning and legal issues
Between Coevorden and Emlichheim, the 350-hectare Europark Freight Village is located directly on the German-Dutch border. It reflects how freight village management works to the advantage of the companies located there, even under complex conditions. Although there are sometimes considerable differences in the basic conditions, not least in the land prices, it has been possible in recent years to exploit the advantages of each location to accommodate logistics-related companies on both sides of the border. The funding available has changed since then, but companies can still benefit from special support, such as subsidies for innovations or funds for the construction of their own rail sidings, for example.