Fastener demand from general industry appears to have remained stronger in most countries, except Italy. Typical reports from Germany indicate demand shrinking by 20% to 30%. NEVIB in the Netherlands reports a 5% to 15% shortfall against the previous year. Overall fastener sales in the UK look to have fallen by around 50% in April, although the range by company is literally 0% to 100%. Some fastener companies, supplying critical applications or responsive manufacturing services, reported higher demand, although their response was curtailed by safe working protocols and in some cases raw material and subcontract service availability. In France, overall fastener demand during April also looks to have halved. In Italy, because of the severity of the lockdown on industry, the reduction in fastener sales in April is expected to be close to 75%.

With demand suppressed, fastener inventories are inevitably building, particularly as shipments from China ‘catch up’. The long range supply tap is slower to turn off but that clearly is now happening, with reports of Asian fastener factories on short time working. For importers, liquidity and actual storage space to accommodate increased stocks are the short-term issues. The next challenge for manufacturers and importers alike will be to cope with volatile and unpredictable demand. With demand down, overall inventory levels will be deep for some time. However, gaps will develop and are likely to present opportunities for local manufacturers that can respond flexibly. China’s rapid emergence from the coronavirus, will foment calls for increased trade defence measures to protect European manufacturers. How the EU responds, given American protectionism has already demonstrated the risks to global trade, remains to be seen.

It is too early to gauge the wider supply chain implications the coronavirus will generate. There is talk of the death of globalisation, of major reshoring activity to secure supply chains. However, the cost advantages of global supply chains will not fundamentally change – nor will the growing demand for goods from rising economies, particularly in Asia.

Unquestionably the major concern right now is company liquidity. Supply chain payment strategies have varied. In Italy the trend of customer non-payment started at the end of March. In the UK, behaviour polarised. Some, through need but many through policy, stopped April payment or unilaterally increased payment days. By contrast, others are consciously paying to terms or sooner to support their supply chain. As several have noted, memories of these behaviours will be long.

Unprecedented government support programmes have been targeted to protect businesses and jobs in the short-term, by paying a significant proportion of furloughed worker salaries and ensuring preferential loans to businesses. Some companies are clearly averse to increasing their debt burden for as long as it is avoidable. The next issue, as government support schemes taper, and with depressed sales continuing, is the risk of large-scale redundancies. Governments, already committed to unprecedently deep debts, must wrestle with the choice between incurring further debt to provide continued, flexible furlough support, versus the social, political and welfare costs of escalating unemployment.

A final, and consistent thought from all our ‘correspondents’. There will be no return to a pre-coronavirus normal. The new normal will be very different, for the foreseeable future – living and working alongside Covid-19. Technologies have been proven during this crisis – whether robotics or online sales communications, remote working systems or data management – and they will continue to have relevance in, and influence, that new normal.

There is also the harsh reality that some fastener businesses simply will not survive. In the short-term through lack of liquidity, perhaps longer term by not being able to recover real viability or simply through opportune acquisition. Governments, too, will need to service the massive debts currently being incurred – and that eventually must mean a heavier tax burden for business and individuals.

They say the sword is tempered by the fire. This furnace is the fiercest most will ever have experienced. However, the fastener industry has long demonstrated its resilience against the odds. Stay safe.

Limited space makes it difficult to do full justice to all of the generous contributions reflected in this article. Some responses are published more fully on the fastenerandfixing.com website and provide an intimate insight.

The support of all of the following is deeply appreciated:

·Jacques Barrier, Prismefix, France

·Jorge Cámara, Chavesbao, Spain (Full article: https://www.fastenerandfixing.com/industry-news/a-letter-on-covid-19-from-chavesbao/)

·Ramón Cervalls, Gruppo Celo, Spain

(Full article: https://www.fastenerandfixing.com/industry-news/how-covid-19-has-impacted-italy/)

·Alexander Kolodzik, FDS Germany

·Vincent van Dijk, NEVIB, The Netherlands

·BIAFD and CBM, United Kingdom