Ulrich Spranger | CEO
Jarltech Europe GmbH
When it comes to prices, our industry has mostly known downward movement. Suddenly prices are increasing for many vendors. So what? Well, we make more turnover and the absolute margin goes up. Even vendors who (despite massively increased freight costs) are somehow still increasing their gross margin (according to the stock market report), are increasing their prices. None of our vendors who have raised prices has ever had to suffer a dip in sales as a result. So it seems that price increases are not hurting vendors. Apparently, our solutions and products bring a much higher efficiency increase in the application than they cost.
The only warning: Do not make offers now where the price between the offer and delivery is valid for longer than 30 days. That could be suicide. If an end user has a fixed roll-out plan, then buy the goods immediately, and the customer must sign and guarantee their plan. Simply reserving goods doesnt help. Projects run out, prices suddenly rise, even for orders placed in the future. This situation can be explained to customers right now because every day in the press there is talk of price increases. If a project is postponed, it could become more expensive.
Lets look at it from a distributors point of view: If a vendor raises prices, we get additionally billed for our current stock, depending on the contract.
But this situation gives you new bargaining power. It is »common sense« that prices are currently rising and that availability is suffering. If a customer tells you they need 1,000 scanners by the end of the year, they will simply have to buy them now. Otherwise, they probably will either be more expensive, or he merely wont get them. And if a competitor grabs an order away from you because he guarantees prices for a long time fine, then your competitor will soon pay on top. Its that simple.
But dont let yourself be blackmailed, please!
On or the other end customer has taken things too far, pushed you and us up against the wall and then bought cheaper somewhere else. If he needs goods and maybe also a dealer who works together with the distributor with the highest stock, then we dont have to draw our guns and sell the goods for zero margin. Regular customers will always be helped, no matter what. But those who have always bought merely by price may now have to pay a realistic price. And pay for the value of the stock and a good relationship.
To this day, no vendor has ever intervened in existing project prices. But please pay attention to how long your projects are limited until they must be renewed. In the last 20 years it has not happened that the prices rise in the middle of a project renewal, but it can happen now. So please be careful to submit your offers in such a way that you have certainty.
Website dilemma :) and the future
It had to be done: We have a new webshop. Completely self-built and with a functioning search function, and it’s also much prettier. However, the reactions were split: some of the customers cheered us, others wanted the old shop back.
Career guidance at Jarltech
We were honoured to host a career guidance session for Rotary yesterday for a local high school at our Event & Training Centre. I didn't think it would be so much fun to answer questions and give advice, together with a panel from other sectors. The students asked very good questions indeed.
Jarltech and Eintracht Frankfurt
On this big day, I can't think of much else but Eintracht Frankfurt. Today is the first Champions League round of 16 in the club's history. Why is Jarltech a partner of Eintracht Frankfurt? We simply fit well together. Everyone plays in the Champions League in their own field. Everyone in the team stands up for each other.
I am looking forward to 2023. I hope it will be a little easier than 2022. All in all, 2022 was good. Despite the many challenges, Jarltech increased its order intake by an even 10% to approximately 825 million euros. We added some promising new manufacturers to our product range, hired more employees and apprentices and rented new space in addition to our campus.