For the past three months, Sumitomo Rubber North America Inc. (SRNA) has conducted COVID-19 Dealer Resource Forums in order to keep dealers informed from a manufacturing perspective. Richard Smallwood, CEO and president of SRNA, discussed the success of the forums, as well as the United Steelworkers' (USW) latest petitions for antidumping and countervailing duties, with Tire Business.
Q How would you describe business thus far in 2020?
A Business started a little slow this year, but we believe it was due primarily to shipments at the end of 2019 being greater than demand. Dealers needed a little time to sell through that excess inventory and bring inventory back into healthier levels.
Q What are some of the key changes the company has made in order to keep employees and customers safe during the pandemic?
A At the corporate office, we transitioned all employees from a work-at-the-office scheme to a work-from-home scheme. The transition was flawless, and I believe we were able to maintain service levels as good as before.
We started the process of returning employees to the office in stages starting May 11, and then took all of the precautionary measures such as checking temperatures, requiring COVID-19 antibody testing, ensuring social distancing, requiring masks be worn and frequent cleaning of all high-touch areas.
At the warehouses, it was similar, but we also eliminated will calls and prohibited any outside visits.
Q SRNA has been conducting Dealer Forums for several months. What benefit have you seen from them?
A Our objective was to provide a forum for our customers where they could hear from others what was happening on a broader scale from different segments of the business and different parts of the country.
Our customers were hungry for information for what others were experiencing, and we wanted to help them hear from others what was happening. We have received amazingly positive feedback from our customers, which has encouraged us to maintain these webinars for as long as our customers feel they are valuable.
When our customers feel there is no longer any value in us conducting these webinars, we will stop doing them.
Q What have you learned most from dealers through the forums? What has the response been?
A Overall, the biggest lesson for us is that the dealers wanted to know if they were the only ones going through a rough time, or if they were having a more difficult time than others. When they began to hear that all of us, large and small, are going through a similarly challenging time, they felt much better about their particular situation.
Q Do you expect any supply difficulties in the second half of the year?
A From an industry standpoint, I would expect there to be some inventory imbalances caused by the plant shutdowns. No matter how hard we all try to forecast the future, we rarely predict it perfectly.
From an SRNA standpoint, we will emerge out of this situation with slightly better inventory in key product lines, but it will largely depend on when the market returns to normal levels, and how consumers shift buying preferences between the different price positions in the market.
Q What are some of the pleasant surprises you are seeing in the industry?
A Market recovery has been quicker than we have anticipated, and fewer dealers have gone under than we feared.