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29 Jan

Lockdown 2020 - A look ahead:

2021 Enhanced Online Businesses

(mud) – WTH managing director Walter Thieme looks to the new year with confidence. He sees his company as digitally optimally positioned and bases his assessment on proven and solid business relationships - especially in Asia. Online activities will play an increasingly important role for the Stader company in 2021.

The coronavirus, which measures only a few nanometers, has achieved what would have been dismissed as a utopia without objection. Our lives have been shaken globally. Aid and rescue packages worth billions were put together against economic damage.

Private and public life has been shut down globally in ways previously unknown. Health systems threatened to collapse worldwide. Sectors with predominantly social contacts lost customers and clients from one day to the next. Countless self-employed people suddenly lost their livelihood. Education and culture came to a standstill, families and partnerships were faced with severe tests.

We at WTH also had to adjust to the new situation “from now to after”. Our investments in digital technology and its processes, initiated a few years ago, quickly turned out to be an effective tool for overcoming the challenges.

We were able to quickly and effectively integrate internal and external virtual meetings into our business processes. The change processes that were initiated could only be implemented thanks to the great acceptance of our employees and their commitment. So we managed to implement digitization and optimization of business processes accordingly smoothly. Nevertheless, despite all the technical progress, human thinking, acting and feeling remain an essential building block for business success.

Nevertheless, the corona crisis is leaving its mark on us too: Fortunately, the polymer processing companies in the chemical industry were not nearly as hard hit by the restrictions as, for example, the hospitality, event and accommodation industries. Not even our company. We are happy that industry and economic goods traffic continued for us - albeit with restrictions.

As formulated by the official side and economic institutes, we also expect reduced business developments, at least until summer 2021, because the course of the pandemic remains uncertain. Reliable prognoses are only possible when effective vaccines and medication are available.

There are signs of relaxation in the global trade disputes and the consequences of BREXIT will also be known in Europe. We therefore expect a general economic recovery in the course of 2021. This should also have a positive effect on our business development. It should be mentioned in particular that the often feared second wave of infections in the important Asian economies did not materialize this year.

As a result of the digitization of economic processes, WTH expects increased online activities, including virtual meetings with business partners at practically all levels. However, Walter Thieme does not currently see an "online shop" for the business model of the B2B products, which require a lot of explanation.

However, the trade fair formats will change in order to reach their audiences digitally and personally in the future. Something similar has already happened in the offices: The desk and cabinet areas of earlier times are no longer needed. Digitization and the fast internet have and will continue to change office work permanently.

A very large free trade area has recently formed in Asia: Regional Comprehensive Economic Partnership (RCEP) already represents almost 30 percent (EU approx. 18 percent) of the global gross domestic product. We obtain a little more than 50 percent of our goods from contracting states of the RCEP, of which more than 2/3 are of Chinese origin.

Walter Thieme: “We expect our existing business relationships in the RCEP region to be solid and sufficiently resilient and that the flow of goods from the region will not be redistributed at the expense of Europe. In this respect, we trust that supply chains will continue to function not only nationally and within the free trade areas, but also between the free trade areas and a functioning WTO ”.

Concentration and rising operating costs due to "IMO 2020" reduction in global ship emissions through the use of low-sulfur fuels (max. 0.5 percent instead of the previous maximum of 10 percent sulfur content) in general and LNG in particular are driving up sea freight. In addition, “the ships are full again” so that shippers no longer have enough tonnage to choose from. Various measures to reduce harmful effects on the environment also lead to corresponding additional expenditure in land transport, but also in the production of raw materials.

Because cost increases cannot be compensated for by rationalization and productivity increases alone, moderate price adjustments cannot be ruled out for our products either, says Thieme and concludes: “All in all, we expect a perhaps less turbulent year in 2021, because important aspects are still unclear in 2020 (BREXIT, US election, Covid-19 vaccine, etc.) should be clarified. "