by Fulvio Marcandelli | Senior Credit Manager at EBV Elektronik, an Avnet Group company. Avnet Group
The global pandemic crisis is putting a strain on the entire economic system, or at least the one we were used to knowing until now, and we have to do something about it. The cash flow suffered greatly in March and April, but in the months that followed the situation became much more normalised and, although their turnover was reduced, most of the companies in the sector (mainly subcontractors operating in the microelectronics sector) fulfilled their payment commitments and agreed repayment plans.
Mixed signals
It's not up to me to speculate and forecast what the market will be like in the near future (I'll leave that to the more competent gurus ), but the confidence that investors have shown in all the world's stock exchanges in recent months (certainly encouraged by the central banks' policy of lowering interest rates) by investing in companies in the real economy without too many sectoral distinctions is comforting.
Certainly the premises before the lockdown were strongly geared towards growth, driven by innovations linked to the 5Gthe increasingly widespread diffusion of IoT, to theelectric car and the new frontier ofEdge computingall of which are set to take up a large part of the production of both active and passive electronic components. The Covid-19 has brought the situation to a halt, but there are signs of recovery: in China there are companies that are hitting new records in terms of turnover (such as the Chinese branch of Interpump SpA) and the long wave of recovery will sooner or later reach us too.
What will happen in the world and Italian markets? There are companies in difficulty that are using social shock absorbers, but there are signs of reawakening and Credit will have to manage, as usual, the important role of mediation between corporate finance and commercial penetration. However, the greatest attention is being paid to shipments, as there are well-founded fears that there could be an increase in insolvencies and cancellations of orders previously placed. In addition, insurance cover is likely to be restricted for most operators.
The role of the credit manager
It is, however, at times like these that the professionalism and farsightedness of the good credit manager emerge, who has sown over the years and has been able to consolidate loyal and open relationships with customers (external and internal), structuring and guaranteeing his client portfolio with Factoring and Reverse Factoring contracts (which guarantee continuity in cash flows) or protecting it with adequate insurance policies to cover any risks of insolvency, "in law" or "in fact", and having built over time a close-knit team that manages, even in remote work, to be "effective and efficient".
In addition to the above, the Credit Manager, being very often "the most commercial of administrators, and the most administrative of administrators", must be updated not only on "market trends" and new regulations (split payment, electronic invoicing and so on) but also on "new opportunities" to be seized for the benefit of his company.
More conscious management
But how do you keep up to date with market news and try to be proactive and innovative within your company without running into easy 'traps' and errors of judgement? For some time now I have been intensifying my relationship with A.C.M.I., Credit Manager Association Italy which offers a continuous and constant update programme made up of meetings with specialists and institutions, on topics dedicated to those who manage credit in companies.
Acmi has several Sectorial Groups divided by market logic, including the newborn Di.El. (Electronic Distributors), in which, through periodic meetings, members can share experiences and, through comparison, increase their experience and professionalism. The new frontier of CM, for a more aware management, is that of being able to access the data of the Bank of Italy's Risk Centres, and to include in the commercial offers of its companies agreements with authorised financial operators to allow easier access to credit for its customers.
