Paweł Czuryło, Interia: How has the Oknoplast Group changed during the pandemic?
Mikołaj Placek, president of Oknoplast: The pandemic is, of course, a huge challenge for the entire industry, including us. We are dealing with global problems with the smoothness of supplies, shortages of raw materials on the market and an increase in the prices of semi-finished products. It is especially visible in the case of PVC, glass, steel and aluminum. Shortages naturally translate into higher prices of final products. It’s hard to predict when we will face it. The key to success in such difficult conditions is the speed and flexibility of operation, so as to maintain continuity of production and timely deliveries of products. Following this simple to define, but not easy to implement strategy, we managed to achieve a large increase in sales in 2021 in the conditions of a pandemic.
Economists have recently emphasized that companies are stockpiling more. Oknoplast too?
– We are trying to maintain a greater stock of materials as much as possible than in the years before the pandemic and to diversify suppliers so that in the event of delays related to deliveries, we can continue production and deliver the product on time. It is one of the elements of flexible management that has been forced on us by the pandemic, i.e. constant readiness to respond to market needs.
– An element of the strategy of quick and flexible adaptation are also investments that develop Oknoplast in terms of technological resources, increasing storage capacity, infrastructure expansion and, above all, better organization of work. The effect of this is the expansion of the plant, completed this year, with a finished goods warehouse with an area of 16 thousand sq m, for over PLN 65 million. The next planned investments for over PLN 100 million are two new halls: production and storage, which we plan to put into use at the turn of 2022/2023. We also invest in process automation and constantly modernize our production lines. To secure sales for such increased production capacity, we are entering new, non-European markets, I mean Spanish-speaking South America and North America.
The market in Poland is significantly different from the foreign one?
– Currently, the economy – both global and domestic – is facing a number of cumulative challenges on an unprecedented scale and in one and relatively short period. Oknoplast currently has 4 brands: Aluhaus, WnD, Hermet10 (Ampuero) and OKNOPLAST. The vast majority of the group’s over PLN 1.3 billion in revenues in 2021, i.e. as much as 80 percent, comes from foreign sales. However, the domestic market remains very important to us and we also have many plans for it.
What are your forecasts for 2022?
– Instability and uncertainty are probably the words that best describe the economic situation in the last two years. Of course, the economic situation is by definition somewhat volatile, but now the pace of changes, their intensity and scope are greater than ever before. In such conditions, forecasts are of less and less importance. Acting here and now counts.
– For example, on the example of the prices of raw materials and semi-finished products, we can see that you need to be ready for quick and often radical changes in assumptions and plans. At the moment, we anticipate that the prices of raw materials will rise again soon, which will result in higher sales of end products in our industry. When it comes to the joinery industry in the European Union, we expect a large increase in demand for windows and doors, as the community forces the reduction of CO2 emissions and greater energy efficiency, and this is followed by government subsidies to replace the woodwork in order to increase the thermal insulation class of existing buildings.
How much have the costs of raw materials and labor increased from the perspective of Oknoplast?
– Increases in the cost of raw materials currently range from a dozen to several dozen percent compared to 2020 to 2021. One of the biggest increases was recorded in wood prices, which last year increased by several dozen percent. Additionally, the price of steel has increased by over 100 percent. The increases also affected materials such as aluminum, glass and PVC. This, of course, significantly translates into an increase in the production costs of joinery products, which in turn increases the prices of windows by as much as 15-20%.
– Higher labor costs are also visible, not only in Poland, but also abroad. Both wages and other enterprise maintenance costs are rising. As a company operating in 17 markets, we constantly analyze the situation in the countries in which we are present and constantly adapt our activities so as to be able to develop. I repeat – speed and flexibility are the best recipes for such challenges.
In addition, the labor market in Poland is already very shallow. In production, we can even speak of the employee’s market. Are you running out of hands?
– The total employment in companies forming all 4 brands of the Oknoplast Group is approximately 3.2 thousand. people, of which over 2,000 are employees employed in Poland. It’s no secret that securing workers in the manufacturing sector is a challenge these days. Is it an employee’s market? Rather, it is a market of partnership between the employee and the employer. We recruit appropriate staff, among other things, with good conditions as well as consistency and stability, expecting professionalism and commitment in return. For years, we have been offering non-wage benefits such as insurance, medical care or financial support in pursuing hobbies and interests. It is also important to provide employees with the opportunity to expand their knowledge and develop skills, be it through the company’s e-learning platform with free access to training for all employees or subsidizing studies and highly specialized courses. Of course, we also have an extensive incentive system, under which employees are rewarded, among others awards for innovative projects or above-average results.
Employees are demanding inflation increases?
– When it comes to pay rises, we assume a budget for increasing salaries each year. We make sure that it is attractive for the team and appropriate to the economic situation. It is important for us that the work performed is combined with reliable and satisfactory earnings.
How do you assess the elements that make up the Polish Deal?
– The assumptions and regulations of the Polish Order cover various aspects of the economic and social situation of our country. They have both advantages and disadvantages. At Oknoplaście, we try to effectively adapt the activities and working conditions also to the changes associated with this program.