German confectionery sector faces tough measures during coronavirus
The German confectionery industry has not been immune to the coronavirus pandemic with 52% of companies reporting first quarter decreased sales, according to studies from the Federal Association of German Confectionery Industry (BDSI). The BDSI represents the economic interests of over 200 German confectionery companies and has called on the government to give priority to the domestic economy in order to secure jobs and investments in the country.
The results were down to the loss of important sales channels such as department stores and sweets stores that have remained closed for a long time during the COVID-19 crisis. This is in addition to other key traditional markets including public festivals, which have been banned under present government guidelines as the country, along with the rest of the world, grapples with the pandemic.
According to the research from BDSI, 73% of manufacturers within the confectionery and snack market category said that the current outlook for the rest of this year, would be more challenging than last year. This year’s major international sweets fair, ISM in Cologne (pictured), was staged at the end of January, just as the coronavirus pandemic was taking hold, with the broad range of releases for 2020 unable to subsequently reach markets in the coming months in light of the virus causing widespread disruption to markets.
In addition to decreased domestic sales, the results of the survey found that export markets had also been significantly hit, with 57% of companies recording a sharp downturn in demand for sales in this traditionally strong segment. Within export orders, sales were reported to be down by 64%.
The survey also showed that 84% of companies are affected by the corona pandemic facing human resource challenges, in particular, the lack of available childcare of employees within companies leads to practical problems. In the opinion of the BDSI it is necessary to consistently strengthen the domestic economy policy top priority to be given to jobs and investment to support the national interest.
Bastian Fassin, Chairman of the BDSI said: “New regulatory requirements in the current situation are becoming a challenge and small and medium-sized companies can no longer bear additional costs. What companies need now is relief in corporate taxation and a consequent reduction in bureaucracy, as well as a deferral of bills that are not absolutely necessary.”