Antidepressant for the Czech industry
The current state and immediate prospects of the Czech industry are not entirely positive. As a result of weak demand, industrial companies expect production to stagnate. Is there a miracle drug that could reverse the current trend?
This article was inspired by a comment Czech industry in depression. The mood in domestic industry remained at freezing point even in October, which appeared on the Kurzy.cz server.
Here are a few quotes from it (emphasis added):
- “Although the PMI rose cosmetically from 41.7 to 42 points, it remains deep in the recession zone (< 50).”
- “At the same time, domestic manufacturers are increasingly registering cancellations of orders .”
- “Today’s numbers are in line with our expectation of weaker industrial production in the rest of this year, which will hold back the Czech economy.”
So the problem at the moment is not primarily outages in supply chains, as was the case in the recent past, but a slump on the demand side – a lack of orders , or their cancellation.
Before we think about possible ways to solve the situation at the level of individual companies, let us briefly recall what the mentioned index of purchasing managers actually is.
What is the Purchasing Managers’ Index (PMI®)
The Purchasing Managers’ Index (the abbreviation PMI is derived from the English Purchasing Managers ‘ Index ) is an important global economic indicator that measures activity in the manufacturing sector .
As the name suggests, the index is based on surveys among purchasing managers of selected companies in more than 40 countries. They answer questions every month about new orders, production, employment, delivery times, prices or stocks.
The PMI index ranges from 0 to 100. A value above 50 means that activity in the manufacturing sector is increasing compared to the previous month, while a value below 50 means that activity is decreasing .
In general, we can say that the PMI index is a very reliable indicator of the situation in both manufacturing and services. And considering the current numbers, he wants to add: Unfortunately reliable.
Is there a cure for industrial depression?
Despite the slightly tabloid headline we chose, we dare to say that there is no miracle panacea that would get the Czech industry out of the depression.
But there are at least two partial steps that can work as an economic antidepressant. Steps with which we can help Czech industrial companies. And we already help a number of them .
1. Diversify your client portfolio
It can be nice to have one or two important customers for a long time. But only as long as everything works as it should.
In the event that your big client that you rely on to a large extent gets into trouble, it is likely that it will take you at least partially down with it. And he doesn’t have to go bankrupt outright – it’s enough if he slows down production and his demand for your products drops more significantly.
A functional solution (similar to investments) is diversification .
If you have established cooperation with several customers, ideally from different industries, there is a much greater chance that you will manage the period of economic decline , and maybe even come out of it stronger.
2. Outsource your business activities
Outsourcing frees up your hands so you can fully focus on the core of your business . If you are a representative of a manufacturing company, it is very likely that you are already using it in some form. Maybe you outsource IT services, accounting, cleaning services, marketing…
In a similar way, you can also delegate your business activity to an external partner.
You can either choose complete outsourcing , or use your own salespeople, but outsource the identification of companies that are worth approaching.
Intedat is not a panacea. But doping is allowed
We would not dare to claim that our solution is a universal anti-depressant for Czech industrial enterprises. However, the experience of our clients shows that it works excellently as both a prevention and a timely solution to a drop in demand .
Thanks to it, you can easily find potential business partners who match your ideal client profile.
And if you want, you can completely outsource your business process to us. We will contact selected companies on your behalf, and we will hand over to you only those that have shown interest in your products.
Thanks to Intedat, you get, among other things:
- access to a top-notch, continuously updated company database (up to 100 million companies in the world and 1.5 million companies in the Czech Republic)
- information about competent persons, often including direct contacts
- advanced filtering, including mirror selection
- possibility to connect Intedat with your CRM system
We have already found new clients for more than 900 Czech companies . We will be happy to help you with that too.
Contact us
to arrange a no-obligation consultation.
Resources:
- Czech industry in depression. The mood in domestic industry remained at freezing point even in October. | Kurzy.cz
- “PMI® – The World’s Leading Economic Indicator” Brochure (PDF)
