There is light at the end of the tunnel: in May, many production plants will start their ramp-up. But how? And what do companies have to do now?
Initially, a company’s compliance with the new health and safety rules must “simply” be ensured. Seems obvious, but in practice this may pose a challenge for companies that do not have their own specialized health and safety departments. “Besides”, this also entails liability issues. As a manager, it is your responsibility to ensure that your company meets all requirements. Unannounced inspectors may and will suddenly show up in the courtyard or in the factory hall.
Speaking of liability: The Corona crisis does not invalidate a management’s liability! Even in these times, you must be careful not to miss any deadlines if your company is in turmoil. Be cautious and careful!
What is the starting position for the ramp-up?
It is already foreseeable today that people are going to consume less in the coming months. Companies will also invest cautiously. In the B2B business, “better” prices are going to make the difference. Payment terms will be extended and higher risks than during normal times must be taken.
As for that, the challenges are not going to automatically diminish with the end of the acute Corona crisis. On the contrary: we do expect much more competition in 2021. International competition is getting tougher. China has the advantage of being more advanced in the current cycle. The country is already ramping up again. Altogether, other Asian countries are less affected. We should be prepared for significantly increased competition in Germany and Europe as well. Subsequently, companies must handle two burdens simultaneously: the deferred taxes and social security contributions must be paid – and lower prices are obtained for their own products due to increased competition.
In addition, there are supply chains that must ramp up again – and thinned-out production facilities run with less output.
What does ConMoto recommend?
Get your business in shape! Ensure a reliable, resilient supply (Caution: risk of price increase!). Be prepared to provide liquidity because you will have to accept longer payment terms and adjust to increased risks on the supplier side. Your means of choice are the increase in productivity and efficiency as well as process and product cost reduction!
We are looking forward to discussing our services with you.