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Study : 41% of the managers consider that GDP will drop
The managers prefer in large numbers the traditional instruments for financing (42% banks and 41% own sources) and only 8% choose the capital market, as the degree of information with regard to the Stock Exchange Bucharest is slow, with only 15% of the managers who state they are informed with regards to its activity, according to the results CONFIDEX S2 2021 published by Impetum Group. He shows that access to the capital market, which could offer continuous financing of the company and which offers a high degree of trust to the business partners.
The official figures show a spectacular growth of the capital market in pandemics, being a very good alternative to financing. Thus, on the Regulated Market of the BVB, the liquidity measured through the total value of trading with all types of financial instruments has increased by 21.6% in the first eleven months and reached 17.4 billion lei, the equivalent of 2.5 billion euro. Through the indicator of daily average value of trading, the indicator of liquidity shows growth of 20.5% to 75 million lei, the equivalent of 15.2 million euro. Capitalisation of the companies present on the Regulated Market of the stock exchange got to 215.7 billion lei, the equivalent of 43.6 billion euro, at the end of November.
37% of the managers consider restructuring as being an internal process, centered on improving operational flows, while 34% consider restructuring as being an answer to foreign factors (market/competition), the study shows. The answers of the majority of the managers with regard to what a process of restructuring means, shows that the business environment admits to the existence of this need and understands that it could be addressed differently, depending on the specific of the situation. A third of the managers consider that the adequate moment to address a specialist in restructuring is that when the company has difficulties in paying their current debts.
The study CONFIDEX shows that the priority of the company for the next period are growth of sales (48%) and keeping the work places (37%). 27% of the managers consider that the company priorities are investments, while 22% say that the digitization of the company and automation. Other priorities are the improvement of the relation with the clients (20%), predictability of the supply chain (17%), improvement of the relation with the suppliers (9%) access to lending (8%) and the activity of research-development (4%).
The report between those who opt for the drop in costs and those who opt for the increase of the productivity remain relatively constant, thus, 69% consider they should increase productivity, even if that means investments to be more competitive on the market and 29% consider that they should reduce costs, to surpass this period.
The growth of productivity constitutes the main engine for economic recovery for more than two thirds of the companies, their percentage being stable, as compared to the previous edition Q1 2021. 69% of the medium and large companies and 63% of the small ones consider that during the next period, they should increase productivity, including investments to remain competitive.
29% consider that the reduction of costs is more important during this period (light growth against quarter 1 2021).
Moreover, digitisation is an upgoing trend, even if the increase against Q1 2021 is rather reduced (+1). In case of 17% of the companies, priority is the predictability of the supply chain.
CONFIDEX S2 2021 shows that the trust of the managers in the Romanian economy dropped to the level at the beginning of the pandemics, and the economic perspectives for the next months worsened: 41% of the managers consider that GDP will get lower (as compared to 17% in Q1 2021). The main worry for the next period are defined by the lack of workforce, increase of prices for raw materials and growing inflation.
There is also an involution of the state of mind of the managers and strengthening of the negative perceptions: doubled the share of those who think that GDP will drop (41% vs. 17% in Q1 2021) increased the share of those who think that the leu power will drop (86% vs 77% in Q1 2021). The managers in HORECA and Transports or those in companies with a low turnover are the most pessimistic.
The main three worries of the Romanian managers resulted from the study (lack of workforce, increase of prices for raw materials and growing inflation) represent approximately 70% of the answers received.
The study CONFIDEX S2 2021 covers a sample of 503 top companies seven categories from the economic sectors contributors to the GDP : agriculture, industry and electrical energy ; constructions ; commerce ; HORECA ; transport, distribution, storage ;services.
The study was attended by general managers and C-level managers, while the companies, 75% of them have over one million euro turnover and 31% over five million euro turnover.