U.S. industries planning for virus impacts
HORSHAM » Manufacturers in the Greater Philadelphia region are monitoring developments related to the spread of coronavirus (COVID-19) and the possible impacts to their businesses — in terms of workforce, sales and supply chain.
That is the finding of a Kreischer Miller Coronavirus Pulse survey of manufacturers in the region, conducted online between Feb. 27 through March 2. There were a total of 22 responses.
Kreischer Miller, a Horshambased independent accounting, tax and advisory firm, developed the survey in part because of what the firm was seeing as conflicting information being made public, according to Michael A. Coakley, audit and accounting director and leader of the Kreischer Miller’s Manufacturing Industry Group.
“It was the quickest way to reach out to as many clients as possible,” he said in a telephone interview. “Since things are changing quickly, we wanted to get the pulse of a moment in time.” Coakley added that he was glad to see commentary coming back from respondents and not just yes and no answers.
The survey asked three questions:
• Have you or will you prepare for higher rates of absenteeism, a work stoppage, or other impacts?
• How much impact do you anticipate the coronavirus will have on your sales?
• How much impact do you anticipate the coronavirus will have on your supply chain?
According to the findings, nearly 73 percent of respondents said the coronavirus will impact their supply chain; while nearly 64 percent said the virus will have an impact on sales.
More than 63 percent said they have prepared or plan to prepare for higher employee absenteeism, a work stoppage, or other impacts to their operations. Breaking that figure down however, more than 45 percent of respondents said they had not yet started on their plan, while about 18 percent said they either have a plan or are preparing. Just over 36 percent said they do not anticipate enough local impact to require a preparation plan.
“We are on the cloud, so working from home is possible,” Nate Bower, president of Rebling Plastics, which makes power connectors and custom molding in Warrington, Bucks County, commented in the survey, adding that home computers for employees will need to be vetted.
A number of the respondents indicated that they are in a “wait and see” mode, according to the results.
“We didn’t know what to expect because we were seeing conflicting reporting on the issue. The fact is a large percentage of the responses indicated they were already planning or getting ready to do it — recognizing it is a real threat,” Coakley added.
Breaking down the results as they relate to potential supply chain impacts, just over 59% said they anticipate some impact, while another nearly 14 percent said they expect the impact to be “significant.”
Dennis Bean, controller at John Evans’ Sons,, Inc., an industrial precision spring manufacturer in Lansdale, said that as of Friday, March 6, his company’s high-yield stainless strip steel supply had not been impacted by the virus.
“We have multiple sources for our steel, and most are domestic,” he said in a statement. The company sources no steel from China, but has some secondary sourcing from countries that aren’t affected by the virus, Bean told Kreischer Miller, adding the company is staying in close contact with suppliers.
“For us, it looks like it’s not immediately an issue, but it could be something down the road,” he said.
David Fryer, controller for Wayne Automation Corp., a pack
aging equipment company in West Norriton, said he doesn’t anticipate any disruption from suppliers, the majority of which are domestic — and sees more potential for sales impacts.
“Most of our customers are multi-national companies so their sales will be impacted, and so goes the domino effect,” he said in his response to the survey.
Patrick Foose, president of GEHR Plastics Inc. in Upper Chichester Township, Delaware County, said he expects the virus will create some disruption in raw according to a press release.
“We are concerned that the scare itself may delay sales from companies afraid to make decisions on purchases,” Fryer added in his response. Coakley added that once the concerns about the virus have passed, there is work to be done by manufacturers. “What should come out of this regardless if they are impacted in some way, is contingency planning in general,” he said. “There could be some other disrupter, so they need to have these plans in place so they are not left scrambling.” Coakley added that contingency planning will be part of the normal discussion he has with clients moving forward.
“It was the quickest way to reach out to as many clients as possible. Since things are changing quickly, we wanted to get the pulse of a moment in time.”
— Michael A. Coakley, Krieischer Miller audit and accounting director