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25 Jun

Economies in corona times

„After the summer doldrums are some more ...…“

Walter and Gero Thieme (with mouth-nose protective mask) expect a pronounced business flair through this summer. In the fourth quarter of 2020, they hope to start business again. Photo Dreyling

(mud) –  Less daily work. Great calm in the company. Short-time working registered for the first time. But to no one thinks layoffs. Quite the contrary. - WTH managing director Walter Thieme remains calm: “The Covid-19 pandemic does not leave us without a trace. But there is light at the end of the tunnel. "

After business in the first quarter was practically unimpressed by the events in China, the first signs of braking appeared in April 2020. Demand was more cautious. "We anticipate a pronounced slump in business throughout the summer," summarizes Thieme, but remains confident: "We hope that business will start again in the fourth quarter of 2020".

A reduced result in the current year is expected according to the forecast currently published by the official body. In addition to sufficient creditworthiness for the economy, this also presupposes that there will be no second wave of infections in autumn, either nationally, in the EU or globally.

In February and March everything was still urgent, so that even air freight deliveries were seriously discussed. Then the urgency subsided more and more. Alternatively, the transport by train from China was accelerated to 3-4 weeks instead of 5-6 weeks by sea. In this way, inventory planning could be kept reasonably cheap despite adverse circumstances.

Walter Thieme: “In our estimation, it was to be expected that due to the Corona restrictions, there were already increasing supply shortages in China. Another reason was that the workers traditionally celebrated this time with their families in the provinces on the occasion of the Chinese New Year. Because of the restrictions imposed, they could no longer travel back to their workplaces. In addition, the vacation time in China was extended by two weeks. All this delayed the planned shipments.

Nevertheless, WTH had always managed to supply all customers with sufficient material so that there were no production stops or other interruptions. Until April, production was within the scope of the previous year's quantities and the corresponding raw materials were also supplied by WTH. Then the first customers began to stretch delivery dates. This occurred with declining business (depending on the country / industry 20 - 40% less sales) of customers, especially in countries 'around the Mediterranean' and Turkey. Thieme: “The effect for us was that our warehouses are currently well filled and that we can safely and quickly supply our customers from our warehouse stocks.

For WTH it is almost typical that you always feel the economic ups and downs of the market with a time lag. Initially, many customers still produced on stock 'or outdated production residues from earlier times. When the stocks are filled, production is reduced and raw material requirements decrease. This would consequently have an effect on Thieme in reduced order intake. The same goes for economic upturns - just the other way round.

With the corona period, the volume of work at WTH has decreased noticeably. In practice, half of the staff can handle the work involved. Because the company management wants to avoid redundancies, short-time work was introduced for the first time. In this way, the lower work volume could be achieved with existing staff without having to dismiss employees.

Before the Covid-19 pandemic started, additional staff were hired at WTH. According to the long-term planning, Ms. Natalie Thunig and Dr. Heiko Vie-brock started their service in June. If you want to gain something positive from the corona crisis, it is the fact that the two new employees benefit from the relative calm in the business and can familiarize themselves intensively with their new areas of responsibility.

Walter Thieme: “We do not see this as luxury, but as an essential prerequisite for the successful cooperation and securing the future of our company. Ultimately, in addition to reliability in doing, the convincing competence in accompanying our products promotes business relationships with our partners at all levels.”