Bruno Negoita, general manager of construction materialsproducer Deutek, held by American investment fund Advent, says thisyear he has been more cautious about clients, whom he checked for aweek before delivering the merchandise, amid a business declineagainst last year.
Deutek's business will see a decline this year because of theslow rate of recovering money and because of the decline in demandand in the average price of finishing materials.
The company posted a 38.1 million-euro turnover last year, ofwhich 8.6 million euros were generated by the adhesives businessBauleiter
"This year paint and plaster will see a turnover decline, but wedon't want to reveal by how much yet. We can only say our drop willbe lower than the market's consumption decline," says Negoita.Consumption of varnish and paint fell by 25% this year against lastyear, whilst the adhesives sales decline amounted to 30%, accordingto data supplied by the leading players on these markets.
Negoita says the company's managers and sales representativeshad to completely change their way of thinking and workingmethods.
"The biggest problem in 2009 has been choosing the clients withwhom we can do normal business, i.e. get the full sum owed for theproducts sold. We had to decline many orders because there was noguarantee that we would get our money back or to there being a veryhigh risk of non-payment. In other words, we chose the safe routeinstead of boosting our market share at all costs. There were caseswhere we ran checks on a client for a whole week before themerchandise was delivered to them," says the Deutek manager. Hesays there have always been swindlers on the market, but that in2009 the non-payment risk also came from honest, butcrisis-troubled businesspeople.
Because of the many distributors filing for bankruptcy, Deutekhad to change some of the companies it was working with to sell itsproducts in order to preserve its level of distribution. "This hasnot been easy because the strategy of most merchants anddistributors in the sector was to reduce the number of suppliersand of products, i.e. the exact opposite of what we wanted,"Negoita explains.
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