Sandvik Implements Cost-Cutting Measures
Order intake volume at Swedish manufacturer Sandvik gradually declined in April and May to a level 40% to 50% lower than
last year, due primarily to low demand across customer segments. As a result, the company has had to take
extensive actions to offset the impact, including reducing staff by 6,000 since October.
In addition
to the staff reductions, work hours will be reduced by 15% to 20% for about 12,000 to 14,000 workers beginning
in June, and 10 production sites will be permanently closed.
"The current market situation
is very weak, which has a substantial effect on a business like Sandvik's. Implemented and approved actions
will have a gradual effect, but the weak volume trend in the second quarter and probably also the third
quarter will have a significantly negative effect ...
Order intake volume at Swedish manufacturer Sandvik gradually declined in April and May to a level 40% to 50% lower than
last year, due primarily to low demand across customer segments. As a result, the company has had to
take extensive actions to offset the impact, including reducing staff by 6,000 since October.
In addition to the staff reductions, work hours will be reduced by 15% to 20% for about 12,000 to 14,000
workers beginning in June, and 10 production sites will be permanently closed.
"The
current market situation is very weak, which has a substantial effect on a business like Sandvik's. Implemented
and approved actions will have a gradual effect, but the weak volume trend in the second quarter and probably also the third
quarter will have a significantly negative effect on earnings," said Lars Pettersson, president and CEO.
"At
the same time, it is satisfying that the favorable trend in cash flow, inventory reductions and demand
in parts of the energy sector that we observed in the first quarter are continuing."
For
the full year, the implemented and planned measures are expected to lead to cost reductions of nearly
SEK 6 billion (US$756 million).
Sandvik is a global industrial group supplying tools for
metal cutting, equipment and tools for the mining and construction industries, stainless materials, special alloys, metallic
and ceramic resistance materials as well as process systems. In 2008, it had about 50,000 employees in 130 countries, with
annual sales of nearly SEK 93 billion (US$11.7 billion).
 |
|
| View the Top Distributors in 12 Sectors: | |
| 2011 Distribution Landscape Report: Access Now | |
Join MDM's Independent Distributor
Network 
Follow MDM on Twitter
Sponsored Links
- Cloud ERP, the next innovation in distribution software. Learn more.
- Get better eCommerce, an easier back-end, and increase revenue.
- Free GCommerce whitepaper: How to reduce transaction costs, streamline special orders
- Cloud ERP, the next innovation in distribution software. Learn more.
- Protect your revenue and grow your business with Cortera PulseTM
- NSK's P4Y precision-class universal bearings' multiple configurations reduce inventory
- Resources and training tools for distributor sales, management and more in the MDM Store
MDM Digital
 The Case for Mobilein Distribution Marketing John Sonnhalter explains why distributors should include mobile in their marketing plans and how to start. Watch now. iPad users: click here to view. |
 Economic Update:The Festering Euro-Crisis MAPI Economist Kris Bledowski analyzes the outcome of recent meetings about the European banking and debt crisis. Watch now. |
 Online Marketing Tipsfrom Bob DeStefano Many companies make the same mistake on their company websites. Do you? Find out. |
More Audio and Video Features from MDM: |
Think About It: |
Upcoming Programs
|
|
Training Resources
 |
 |
 |
 |
|||
|
Featured Article - MDM-Baird Benchmarking Survey: Distributor Optimism Returns $34.95 |
Management Tips from Modern Distribution Management $49.95 |
Inventory Management Best Practices with Jon Schreibfeder: DVD + Book $119.00 |
Benchmarks & Best Practices: The Answer Book for Growth-Minded CFOs & Controllers $249.00 |
| Title | Company | Location |
|---|---|---|
| Credit/Collections Manager | APR Supply Co. | Lebanon, PA |
| Management Trainee | APR Supply Co. | Lebanon, PA |
| INDUSTRY SPECIALIST - Rubber Products | KAMAN Industrial Technologies | North East Area - CT, MA, ME, NY, RI, VT |
| Sales Account Manager - Energy Market Segment | TESSCO | Baltimore, MD |
| Channels Marketing Representative -- Advanced Supply Chain Business Information Systems | Scientel Information Technology, Inc. | Southeast Michigan |
| Technical Trainer - Innovative Change Agent - Long Island City, NY | Daikin AC | Long Island City, NY |
| Sales Representative | Superior Essex | Minnesota |
| View ALL Wholesale Distribution Job Listings |
|
|
Industry Topics sponsored by
Distribution Trends
|
Economy
|
Management/Strategy
|
Interviews
|
Operations
|
Technology
|
Mergers/Acquisitions
|
Case Studies
|
Sales & Marketing
|
MDM Calendar
Operating for Profit: The Coming Revolution in Supply Chain Finance
Mobile Technologies for Distributors with Steve Epner
Featured Products
Benchmarks & Best Practices: The Answer Book for Growth-Minded CFOs & Controllers
2011 MDM Market Leaders and Distribution Landscape Report
The B-to-B Online Marketing Toolkit:
A Step-by-Step Plan for Distributors and Manufacturers to Leverage Online Marketing
for Bottom Line Results
Leave a Comment