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USA
What Effect has COVID-19 had on the Retreading Equipment and Supply Industry?
Most often we forget that the retreading industry is not only about the retreaders that crank out quality retreads for fleets all over the US and around the world. The retreaders are supported by a group of retread equipment & supply manufacturers and distributors that also do a tremendous job at making sure the retreaders have what they need when they need it to keep their plants running.
In this article, we will hear from just a few of them to find out how they are coping with the “New Normal.”
Edd Burleson: President - Central Marketing
How has the COVID-19 pandemic impacted your overall business?
We have a staff of seven traveling technicians, and for several months they were unable to travel to customer locations to do service work. Customer and travel restrictions have started to lift, and our technicians are now traveling again, although we are still unable to travel out of the country or to have people from other countries travel here. We were fortunate to be able to use remote assistance during this non-traveling time period. At the beginning of this crisis, we had some customers asking if they could delay current orders and for extended payment terms.
Were you forced to shut down? If so, for how long?
We are considered an essential business, so we made some adjustments for worker safety, but we did not shut down. We are fortunate to have our business set up so that we are able to provide assistance to our customers via phone and remote assistance, so we were still able to ship parts and provide critical services to keep our customers running.
Were you forced to furlough and or lay off employees due to the COVID-19 pandemic?
Fortunately, we did not have to lay off or furlough any employees. In fact, we added two new members to our staff, and we are still looking to add additional traveling technicians in the immediate future.
Are retreaders investing in equipment during the pandemic and, if so, are they buying new or used?
This appears to be contingent on where the retreaders are located and what the majority of their business is. For the first few months, most companies appeared to be very cautious with equipment purchases, but since the beginning of August, we had interest in new and used equipment, and we have sold a couple of buffers, builders and reconditioned chambers.
Have you had requests for equipment from retreaders opening new plants?
We have delivered two new plants, and we are working on another two in the next month.
Has the demand for plant supplies and accessories during the pandemic been up or down and what are the most sought-after items?
In the beginning, plant supplies were down, but they have steadily picked up and returned over the past few months. It seems that customers are placing more orders for next day air shipments of parts since they are stocking less inventory. Curing envelopes and brushes for the precured treads business has increased because customers were overstocking in the beginning, not knowing if the supply chain would be interrupted.
How has COVID-19 affected the way you go to market?
The effect that I see is that we need more technology in all our equipment so that we can be online with all our machines and not just the major pieces of equipment. Also, we have improved the parts
ordering to be able to send a picture of the part when a customer enquires to help eliminate mistakes. The elimination of dealer meetings and trade shows have also made in- person demonstrations of our equipment impossible so we have had to use video presentations. Covid-19 has caused more TEAMS and Zoom meetings rather than face-to-face meetings, and we are utilising more Powerpoint presentations and videos to communicate effectively with our customers. This correlates to the necessity of having state-of-the art equipment that can be connected online with a competent
technician to be able to remotely service the equipment instead of
in person.
When do you expect a rebound to happen?
I think that it will be late 2021 until things start getting back to where they were pre-Covid as we will need a vaccine and have it available to ever yone before things can return to normal.
Have you experienced an interruption in your supply chain?
In general, we have not had any major supply problems. We do have to order our expected requirements about 5 to 6 months in advance to ensure we have inventor y when someone calls and needs equipment.
What is your outlook for the balance of the year and into 2021?
For the balance of 2020, I feel that the current level of business will hold to the same level as now. I expect 2021 to be down on 2020 as companies will be more conservative on new investments until there is a vaccine for COVID- 19. We also feel that traveling technician service work will be in
high demand.
I feel very fortunate that we have been able to stay open and maintain our staff as there are many businesses that have had to reduce staff and close. I believe that this experience will make our industr y more aware of how important it is to maintain a healthy financial balance sheet to help get
through times like this.
Clyde M. Church: President & CEO - ATEC, Inc.
How has the COVID-19 pandemic impacted your overall business? The COVID-19 pandemic impact has affected ATEC’s business much the same as all retreaders and equipment suppliers.
Were you forced to shut down and/or lay off employees due to the COVID- 19 pandemic?
We had to adapt as the virus has been changing the rules of businesses everywhere. We have been lucky in that we did not have to shut down, nor did we have to lay off any employees. We did, however, modify employee hours to allow more time for family duties. Although we were able to continue our business, we recognise that this was not the case for all families and spouses and that our employees were still affected by work hours changing or having to work from home. This situation is ongoing.
Are retreaders investing in equipment during the pandemic?
During the stay-at-home order at
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