Page 30 - HW May-June 2020

glues, sealants & llers
LATE LAST MONTH, ASB Chief Economist, Nick Tu ey (www. asb.co.nz), summed up where he thought New Zealand was economically, post-lockdown. ere would be three stages:
• Survivingthecrisis.
• Adaptinginaperiodoftransition(couldtakeuptoayear). • Reimaginingitselfintothe“newnormal”.
You might think that we’re already into the second stage, but no.
Nick Tu ey: “ e crisis period is where we are now: surviving the impacts of the lockdown and reopening when ongoing restrictions, behavioural changes, and potential for spending caution mean revenue streams are highly uncertain.
“It has been – and will continue to be – a time of swiftly making hard decisions.”
lockdown, from “be careful” to “stay at home”, was a shock to many.
Says Darren: “I think really the challenge was there was not a lot of time for anybody to prepare or to get their heads around what that was going to mean and what it was going to look like and how things were going to go forward from there.”
LEVEL 4 – DEMAND “WASN’T THERE”
Tony Smith, Business Manager –Distribution at Sika NZ (https://nzl.sika.com/), says he and his team noticed stores were busy stocking up on product in the weeks before lockdown, which meant Sika’s March looked like it was going to be “outstanding”, on top of a January and February they’d already labelled “good”.
“Stage 2 – transition” could last up to a year, he says, during which time “persistent and permanent shifts in behaviour will become more apparent”. is will be “a period in which being adaptable and exible will be important”.
And nally the “new normal” will be about supply chains focusing “more on reliability and resilience, favouring local sources more, even if at higher cost”.
“Trade will be more focused on goods and on services that are more provided by remote and less reliant on people movements.
“ e importance of fully leveraging technology has been starkly highlighted, and will change how we shop, work, and in uence where we live.”
How does any of this apply to the glues, sealants & llers business? More than you’d think...
“AND THEN IT ALL STOPPPED”
So, how was the glues, sealants & llers business leading up to the Level 4 lockdown? My remaining impression now, some weeks later, is of a market that seemed positively buoyant.
With the bene t of hindsight, what do the glues, sealants & llers players make of this?
Melanie Reid, Chief Operating O cer at Soudal (https:// soudal.co.nz/), agrees that, pre-Level 4, the company was “going very well, ahead of where we wanted to be.”
I have been hearing that there was a dramatic dip in business during Level 4. What’s Melanie’s take on this?
“For building and construction there was very little activity,” she con rms, with just a small amount of product required for “essential services”.
However, she adds, because of the extended nature of Soudal’s range into consumer glue and hardware products, the company saw “very strong demand” into presumably the FMCG channel.
Selleys NZ Country Manager, Darren Newland, says Selleys (www.selleys.co.nz) was in a similar situation with sales through the grocery channel, on top of at best modest sales in spite of sealants & adhesives’ status as “essential” during Level 4.
However, he adds, the speed of the shift to Level 4 and
“I don’t see a revolution happening, but I think we can look at [business] completely differently from a flexibility perspective and hopefully make things work more efficiently”
“So we were thinking, well, this is bloody great. But then, of course, it just all stopped!”
Another to cite some frustration at the speed with which
we went into Level 4, although everything possible left Sika’s warehouse, Tony still regrets being unable to ful l some last few orders that arrived the afternoon before lockdown.
Still, having busted a gut pre-lockdown, Sika was another to nd that, during Level 4, demand simply “wasn’t there”.
Paul O`Reilly, National Sales Manager at Bostik (www.bostik. com/newzealand/), says the company was basically closed for the duration of Level 4, along with key customers, with just a few stores open for essential services.
“We were obviously supplying products right up till the lockdown,” he says.
“We didn’t see people bulk buying more than they normally do, but it went from Level 2 to a Level 4 pretty quickly, so I don’t think there was much time for stores to bulk buy. So it was almost business as usual until then...”
Does he feel the company missed out in Level 4? “ e feedback I got was that it was virtually a waste of time – they had virtually no business – and the same for the plumbing guys,” he says.
LEVEL 3 – ALMOST NORMALITY
And what’s the word on moving into Level 3? Selleys’ Darren Newland says: “For us – as I think with every business – it’s been about getting everything back on track and getting through this recent crazy Level 4 situation, just getting everyone back to some sort of level of normality.”
28 NZHJ | MAY/JUNE 2020
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