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Press Saxony, Dresden Mittelstand Chamber Chat

"This crisis is a stress test"


Companies all over the world have to adjust to the impacts of COVID-19. Especially small- and medium-sized enterprises face enormous challenges these days. Read more on how our member BELCHEM GmbH is dealing with the current changes in workforce, production and export.

 

Which challenges does BELCHEM GmbH face during the current COVID-19 crisis and what impact does this crisis have on your business?

At the moment, we cannot estimate the effects of the corona crisis, because the economic consequences are yet to come. However, the economic impact and the global standstill of factories will certainly lead to effects that we will see in the coming weeks. This crisis is a stress test, not only for our company, but for the entire SME sector in Europe, in Germany and also worldwide. It is essential that we all stick together, keep a cool head and act with foresight in order to survive this crisis. We have to begin preparing ourselves today for what will happen after the crisis period is over. Concretly, this means that we are very strategic about investment measures and other large expenditures, as are many other companies. Furthermore, we are confronted with the affects of the uncertainty that surrounds this crisis and the ensuing caution that is exercised by the industry, including suppliers, customers and employees. We are constantly adjusting and readjusting how to best protect ourselves both from a health and from an economic perspective.

 

What measures are you taking to meet the challenges of COVID-19?

We have taken various measures to meet the challenges. On the one hand, we have focused on the protection of our employees. For this purpose, we have trained our employees and talked to them about good hygiene practices, including washing and disinfecting hands and surfaces, using disposable gloves, etc. These measures are very effective and can be easily implemented by any company. Our employees are very understanding and are doing their part to help implement these measures. The main goal we have is to prevent the possible spread of the virus amongst the employees and ensure everyone’s health and safety. We have also employed organizational changes. BELCHEM produces goods 24/7 with a rotating shift system. As an additional measure, we have completely separated the shifts so that the employees in the day and nights shifts do not see each other This will help mitigate the spread of the infection between shifts, should one of our employees be tested positive with COVID-19.  Also, many of our employees are working from home during this time. They are doing an excellent job and we are succeeding in working together very well thanks to digital conference methods.

We have also implemented measures regarding our business operations. We have international suppliers and a diverse customer base. In order to remain as operational as possible, we have weekly virtual conferences with suppliers and major customers to keep each other up to date and to brief each other on current developments in our countries and in our supply chains. Through the increased frequency and open communication, we can jointly address risks or coordinate business interruptions if needed. These preventative measures are taking up a lot of time at the moment but are worth the investment, given the uncertainty.

 

How does the corona virus affect supply chain management and the export of your goods?

Currently, the coronavirus has not yet affected the export of our goods. Our order quantity remains at the same level as pre-corona and we have not seen any significant reductions yet. This is also due to the fact that our products, i.e. the fibers for technical applications that we manufacture, are also needed in so-called essential areas. Our customers have obligations to supply their products into these critical industries and we have to make sure that our production remains operational and that we have on-time delivery.  It is vital for our supply chain management to ensure that this supply is actually guaranteed.

 

Do you have the impression that politics is currently putting together sufficient aid packages to support your business in the current situation?

There is currently a lot of debate and work being done in this direction. Politicians are boasting of large aid packages that can be made available to companies in various ways. I have doubts that small and medium-sized enterprises, who frequently struggle  financially anyway, and where everyone, often the whole family, is involved in the company, will be able to finance additional loans. These small businesses, which I define as up to 50 employees, should instead be helped with subsidies if needed. Loans should be given as quickly as possible to companies that are generally in good standing. After the crisis is over, potential (mis)management can be checked and regulated accordingly.

Secondly, the 10-20% liability of banks is a barrier to the timely processing and transfer of loans.. The fact is that if banks have to be liable for their loans, they always have problems actually paying out the money. An exemption of liaibility should be implemented during this time. In addition, I am critical of the discussion that the German state wants to establish state-owned funds to invest in companys during the crisis and then sell of their stakes for a profit after an appropriate period. In my view, this is an unfair advantage in this time of crisis. The state cannot and should not participate on a large scale in market companies.

 

What further support would you like to receive?

Dates, numbers and facts. I wish that people were confronted with factual, realistic figures and that the hysteria in the media would stop. The answer to corona is not simply stopping all global economic activity. Somebody has to earn money and keep the economy going. We cannot live on simply printing money. We are talking about billions of Euros! This is certainly not a feasible measure, especially as it is not clear who will pay for this. I fear that the responsibility will simply be passed on to future generationsWe need factual figures about the status quo and potential economic effects and we must of course also ensure that we protect our older and weaker fellow citizens without a total economic standstill. That is an apparent contradiction, but it needs to be resolved together.

 

Do you have the feeling that the corona virus is changing transatlantic relations?

We are working closely with our clients and partners in the transatlantic region during this time. It is clear that despite this physical distance, we need to stick together in the spirit of helping and supporting each other, as we can only get through this crisis together. To this end, we must encourage discussions, for example through weekly virtual conferences and telephone calls. We must exchange best practices, so that we can learn from each other quickly. After all, we are all facing a new challenge that we have not yet lived through. Nobody has any experience in dealing with such crises in a company, and it is great if medium-sized companies can learn from larger companies regarding what should be done immediately, what the legal situation is, how to maintain operational readiness andhow to protect employees. I have the feeling that we are very close to our partners and clients in the US and  due to our consistent and open communication we are able to maintain and even strength our relationship in these turbulent times.

 

About BELCHEM GmbH
BELCHEM develops, produces and markets non-combustible, high-performance textile fibers and yarns for technical textiles, nonwovens and fiber-reinforced lightweight construction technologies.

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