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Goods have arrived at the warehouses with some delays in delivery. Meanwhile, consumers aren’t that interested anymore.
While people were stuck at home due to the corona pandemic and could neither travel nor eat out, they ordered a new punching bag, a new lamp or the long-awaited e-bike. The companies tried desperately to comply with the wishes. But because of the disrupted supply chains and production restrictions, companies struggled to meet the high demand.
People caught up on everything they couldn’t do last year.
Prices skyrocketed and consumers had to be patient. Christian Gattiker, Head of Research at Bank Julius Baer, explains: “When companies responded to the great demand for goods and these e-bikes were being delivered en masse, interest was suddenly only half as great.”
In the meantime, the corona measures have been lifted in many countries. Life is possible again without restrictions, people can eat out or go to a concert. Gattiker explains: “People caught up on everything they couldn’t do last year. That’s why a lot of these goods, which were scarcely scarce two years ago, are now lying around.”
After the experience of the pandemic and the resulting shortage of skilled workers, layoffs are the last resort.
Meanwhile, people prefer to spend their money on services, which leads to overcrowded warehouses. Despite the lack of orders for the industry, layoffs are not to be feared according to Christian Gattiker: “After the experience of the pandemic and the resulting shortage of skilled workers, layoffs are the last solution.”
Because in the past one had to realize again and again how quickly the circumstances could change. It is then difficult to find good employees again quickly. Companies would prefer to send their staff on summer vacation earlier. Gattiker emphasizes: “The employment situation in the industrial sector is still very stable.” Nevertheless, many industrial companies and their suppliers will probably have to deal with gloomier sales and profit prospects.