Businesses face supply issues

Businesses face supply issues
Businesses face supply issues

June 01, 2021
Today at
12:26

Companies are starting to experience recruitment and procurement challenges, a new ERGM survey shows.

The recent easing of restrictions has helped to recover turnover in some specific industries, such as non-medical contact occupations and the arts, entertainment and recreational services sector. Nevertheless, the total loss of turnover incurred by the Belgian economy due to the coronavirus crisis has hardly abated, stagnant around -10% compared to normal.

This is what emerges from the new ERMG survey (Economic risk management group), conducted among Belgian companies at the beginning of last week. The survey – the 21st since March 2020 – was carried out by the main employers’ federations from 2,274 companies. It was coordinated by the National Bank of Belgium (BNB) and the Federation of Enterprises of Belgium (FEB).

4%

companies

The percentage of businesses that expect to go bankrupt in the next six months fell from 4.8% in April to 4.0% in May.

A rainy month of May

The reopening of the terraces did no significant improvement in turnover in the hospitality industry, which can be explained by the bad weather conditions in May. The hoped-for catalyst effect for non-food stores Neither did it materialize: their turnover recovered only slightly, standing 21% below the normal level. The loss of turnover of travel agencies has also weakened somewhat, although it still remains at a very high level, at 80%.


The supply chain is severely disrupted in many industries, including industry, construction and large parts of commerce.

On the other hand, the perception of the risk of bankruptcy has clearly improved. The percentage of businesses that expect to go bankrupt in the next six months fell from 4.8% in April to 4.0% in May. This development is mainly attributable to the hospitality industry, where the risk of bankruptcy has decreased significantly, from 17% in April to 5% in May.

Capacity and supply issues

Attention now shifts to supply-side capacity issues. Two thirds of companies thus have difficulty filling their vacant positions., at least for certain profiles, but also often more generally.

64%

wholesale businesses

Two-thirds (64%) of wholesalers experience supply disruptions.

In addition, the supply chain is severely disrupted in many industries, including industry, construction and large parts of commerce. These companies have seen the cost of their inputs increase considerably and these increases will be passed on to the selling price level.

Supply problems are most prevalent in the wholesale trade (64% of respondents encounter moderate or severe disruptions to their supply), construction (58%), industry (57% and even more for certain sub-sectors), non-food retail (46%) and l’agriculture (44%). In contrast, most companies in the service sector are much less affected, as they are generally not dependent on supplies.

The main reason perceived supply difficulties is the shortage at the supplier. This factor is cited by almost 90% of companies facing supply problems (several reasons can be cited for this question).

The transport is also a significant cause of supply problems. It is cited by one in three companies with supply problems and by one in two companies in the wholesale industry.

Source

Businesses face supply issues

 
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