Business is picking up again: craft businesses complain about lost sales

The recovery tendencies in the craft continue. However, the challenges remain enormous due to the corona pandemic. The ZDH association appeals to the public sector because development continues to cause concerns for craft businesses.

The German craft sector is reporting further increases in business in the wake of the easing in the Corona crisis. From the perspective of the ZDH craft association, it is too early to give the all-clear. A survey of more than 1,500 companies in June showed that after the lockdown ended, pandemic impairments in business continued to subside and "tendencies for an upward movement" were discernible. However, companies reported further losses in sales, said the Central Association of German Crafts (ZDH).

"Overall, the loss of sales in the companies remains high because the consumer’s reluctance to buy and buy is also noticeable with products and services in the craft sector," said ZDH President Hans Peter Wollseifer. In addition, the order backlog continues to shrink and many employees are still not available or only to a limited extent.

According to the ZDH, 1538 companies took part in the survey from June 18 to 23. Accordingly, with 42 percent for May, significantly fewer companies report lower sales than in the situation before the corona lockdown. 41 percent reported that sales were at the season's typical level. At 17 percent, sales even increased compared to the pre-corona period. The majority of companies do not expect the pandemic-related sales shortfalls to be made up for by the end of the year.

Construction businesses are threatened by a dip in the economy

According to the information, food businesses (70 percent) as well as the health and automotive trades (66 percent each) were most frequently affected by the drop in sales. Sales growth was reported primarily by "personal service providers" (37 percent). In part, this is also due to special effects, as many hairdressers – when they were allowed to open again – saw a rush of customers. "Concerns over the coming months are worrying that the orders – especially in the construction and finishing works – will not get in as necessary," said the ZDH president. "If we do not reverse the trend here, then the construction trades, in particular, are facing the economic downturn or even the economic downturn."

The public sector, in particular, as the most important client, must act as a role model. The unrestricted ability of public administrations to work is of central importance. When it comes to the development of the order backlog, companies report a slight easing again – 40 percent reported a stable development, 20 percent increasing order volume. Overall, however, the order backlog continues to decrease, according to ZDH, and this decline will be reflected in operating sales. According to the survey, companies expect "an extensive stabilization of their order backlog" over the year.

According to the ZDH, disruptions in the supply chains seem to have recently increased. "If it is not possible to get the supply chains up and running again, many craft businesses will not be able to carry out orders, which would prolong the weak phase," warned Wollseifer: "Overall, the business environment remains a challenge for our businesses."