Business News

Trimo CEO Deems Added Value Key Factor (interview)

Ljubljana, 26 January (STA) - The key question for Slovenia's economy is how to generate added value that would enable good pay, social security and development of the company and the country. Tatjana Fink, CEO of Trimo, believes added value should be raised to EUR 50,000 as soon as possible.

"Those companies who spent all the money on salaries and don't have it enough, cannot develop. Most Slovenian companies generate below 30,000 or even below 20,000 euros in added value, which means they don't have the money for development."

Trimo, which manufactures prefabricated components for the construction industry, has had added value of between EUR 44,000 and 53,000 in the past five years, Fink said, adding that this indicator was the most important one at the level of the group.

She believes the issue is a matter of resources: "We must ask ourselves whether we have the right expertise, whether our education system provides the right knowhow and whether our public sector provides the right support."

The whole society should change, to establish what it could do to support the economy, Fink said, suggesting it was wrong to discuss just wages and distribution rather than how to generate something.

Slovenians have talents, are open-minded and flexible, but lack perseverance, which is indispensable, especially in international business, Fink said, adding that higher added value comes from new products, new markets and new technologies.

"Trimo is constantly introducing new products to the market," Fink said, listing modular facade system Qbiss by Trimo, artistic facades ArtMe and Eco solutions line of products, including photovoltaic roof systems.

Asked about the minimum added value that would afford sound operation of a company in Slovenia, Fink said it should reach EUR 50,000 as soon as possible. "It obviously depends on the industry. For the economy as a whole the average should be from EUR 30,000 and higher."

Fink is satisfied with her company's operations in 2009, despite a substantial fall in revenues, which she blames on a slump in demand and a fall in prices of materials, especially steel plates, which in turn dragged down selling prices.

The company was not seeking any major loans in 2009, so it did not face financing problems, while it felt the credit crunch impact on its customers. "This is one of the important reasons investment activity in all our markets - over 50 countries - has come all but to a halt."

Asked about loan guarantees and other stimulus measures in those countries, Fink said that in Europe these were the most effective in Germany, where Trimo has not registered any major decline and has been operating well. Demand has also started to pick up in England.

"In the long run, you cannot expect the state to intervene all the time. New added value is generated on the market and if the market isn't working, we can talk about whatever we want."

Still, Fink does not advocate a completely free market economy, nor hunt for short-term profit, but rather long-term sustainable development both at the level of the economy and the state. She also believes social welfare and profits must be in tune.

Fink was not too critical about the government crisis measures, saying it would be almost impossible to please everyone. Some companies benefited from the subsidy for shorter working hours, while Trimo as a more technology-intensive company did not use it.

Trimo, a quarter of which is owned by the company that was set up by its employees, is expanding successfully to third markets. Fink believes Slovenian companies have good outlook to succeed in the markets of Arab countries, Central Asia and South America.

However, she also said that having a strategy was not enough and that some Slovenian companies might lack the courage or willpower, while they would also need the right support environment.

Trimo does more than 75% of its business on foreign markets. Even then the Slovenian market fell most for the company last year. That said, Fink does not consider herself a good judge of the situation on the Slovenian construction market, but believes payment default to be a major problem in Slovenia.

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