CEE managers see light at end of tunnel
In autumn 2009, Roland Berger Strategy Consultants conducted another survey on crisis consequences for Central and Eastern Europe. 330 managers from Austria as well as Croatia, Poland, Romania, Russia, the Czech Republic, Hungary and Ukraine were asked about how they see the impact of the economic crisis.
Survey shows that business now sees the proverbial light at the end of the tunnel. The number of pessimists has fallen from 63% in March to just 36%. In the same period, the number of managers describing the situation as uncertain rose from 30 to 47%. And there are three times as many optimists, up from five to 17%. Two thirds of respondents take the view that the crisis will drag on for at least another twelve months. Only a minority expect to see a sustained recovery before the end of 2010.
Regardless of industry or country, companies in CEE again see thinning order books (62.6%) and a seriously worsening problem of unpaid invoices (54%) as the major direct consequences of the crisis. These problems are followed in third place by financing difficulties (38.7%), with falling price (38.4) coming a close fourth – a problem, which has been sharpening in the last six months. In Austria (67.5%) and Hungary (59.1%) deflation fears have already become the second biggest problem cited. In some countries, bankruptcies are frequently mentioned as a crisis impact – coming second in Russia and Ukraine and third in Romania. Two thirds of companies in the CIS countries surveyed and more than 80% of the Romanian companies suffer from trading partners going out of business.
Although there is no rapid recovery in sight in CEE, the doom and gloom has lifted in most industries. The mood in engineering and mining has clearly improved as companies have run down their stocks, which must now be replenished. Demand is stronger and raw material prices are edging up significantly. As the previous survey also showed, the retail and service sectors have survived the crisis relatively unscathed. On the other hand, financial services along with the IT and telecom sectors are still hit hardest by the downturn.
Almost all the companies surveyed have already responded at an operational level with cost savings programs, budget cuts and recruitment stops. Yet less than one in three companies is considering strategic actions like going for acquisitions as a crisis opportunity, revamping the capital structure, or divesting parts of the business. The score for this indicator has not improved since March.
Survey shows that business now sees the proverbial light at the end of the tunnel. The number of pessimists has fallen from 63% in March to just 36%. In the same period, the number of managers describing the situation as uncertain rose from 30 to 47%. And there are three times as many optimists, up from five to 17%. Two thirds of respondents take the view that the crisis will drag on for at least another twelve months. Only a minority expect to see a sustained recovery before the end of 2010.
Regardless of industry or country, companies in CEE again see thinning order books (62.6%) and a seriously worsening problem of unpaid invoices (54%) as the major direct consequences of the crisis. These problems are followed in third place by financing difficulties (38.7%), with falling price (38.4) coming a close fourth – a problem, which has been sharpening in the last six months. In Austria (67.5%) and Hungary (59.1%) deflation fears have already become the second biggest problem cited. In some countries, bankruptcies are frequently mentioned as a crisis impact – coming second in Russia and Ukraine and third in Romania. Two thirds of companies in the CIS countries surveyed and more than 80% of the Romanian companies suffer from trading partners going out of business.
Although there is no rapid recovery in sight in CEE, the doom and gloom has lifted in most industries. The mood in engineering and mining has clearly improved as companies have run down their stocks, which must now be replenished. Demand is stronger and raw material prices are edging up significantly. As the previous survey also showed, the retail and service sectors have survived the crisis relatively unscathed. On the other hand, financial services along with the IT and telecom sectors are still hit hardest by the downturn.
Almost all the companies surveyed have already responded at an operational level with cost savings programs, budget cuts and recruitment stops. Yet less than one in three companies is considering strategic actions like going for acquisitions as a crisis opportunity, revamping the capital structure, or divesting parts of the business. The score for this indicator has not improved since March.
