2020, In Retrospect
The pandemic’s impact on international trade and lessons learned from the year just passed
While most of us were happy to put 2020 in the rear-view mirror, the circumstances of the past year forced many organizations to tap their deepest reserves of ingenuity and resourcefulness, develop new skills and capabilities, and be the best version of themselves. It was important to do so because the post-pandemic world is almost certainly going to be different than the world we knew before.
By most conventional economic measures, 2020 was not a good year. GDP in most countries declined while unemployment surged. Global trade, according to a recently published World Trade Organization report, was trending down almost 6%. U.S. exports were particularly hard hit. The U.S. Government reported exports down 15% year-on-year through the third quarter. Dorian Drake, representing more than 70 manufacturers for export across five different industries, experienced a similar trend.
Amidst the bad news, however, there is reason for optimism. After a steep decline in the second quarter, U.S. exports rebounded almost 25% in the third quarter. Likewise, Dorian Drake, after five months of lean order activity, saw a big uptick in order bookings the last four months of the year, an encouraging sign for the year ahead.
But to fully assess what happened in 2020, it’s important to look beyond the numbers. The pandemic impacted virtually every industry, perhaps none more than foodservice, forcing many foodservice equipment manufacturers to adapt quickly to stay afloat. One company that met the challenge head-on was Nemco Food Equipment, an Ohio-based manufacturer of food preparation and concession equipment that we’ve represented internationally since 2003.
As Michelle Wibel, Nemco’s president, explained it, “One terrible day in mid-March, orders dropped more than 50% from the previous day and continued on that decline for many days until April 6, when orders dropped to 10% of a normal day. That’s very hard to imagine, even in the worst scenario, but it happened, and that was our new reality. So we had to think positive, get products to our customers who were still open, and figure out what to do next. It was not an option to stop selling. It was not an option to close our doors.”
While taking all the requisite precautions to keep their staff safe, Michelle and her management team in just a few short months developed a dizzying array of new safety-related products for their customers, including polycarbonate partitions and face shields; hand-free sanitizer dispensers; hands-free fridge and freezer door openers; hand sinks for outdoor dining; supply stations for hygienic masks, gloves, and hair nets; and curb-side delivery caddies and order stations. To introduce these products, Nemco’s Sales VP Joe Carcione organized a series of short, effective video presentations to explain the features, benefits, and value propositions of each new product to their reps.
Sales of the new products, Michelle said recently, “have helped sustain us during this downturn. I don’t know what the future holds. But I do know we can only control what we can control. We can turn a challenge into a success, recognize the roadblocks and turn them into opportunities.”
At Dorian Drake, we have had to do our share of adapting, too. Our IT team was forced to work at lightning speed in March to equip all of our U.S.-based staff to work from home, a process facilitated by a document management system we implemented in late 2019 and the use of Microsoft Teams video conferencing to meet regularly and collaborate on projects. Over the course of the last nine months, we’ve discovered that with the right tools we can be highly productive working from home.
With international travel not viable, our sales teams spent hundreds of hours conducting virtual sales and product training seminars with our customers around the world, events we did almost exclusively in person before the pandemic. We found our international customers, isolated during the pandemic, eager to connect. We simultaneously worked with our manufacturer clients to conduct more than 50 virtual International Partner Searches, part of a special free service offered last year by the U.S. Department of Commerce to stimulate U.S. exports. We conducted many of these searches in secondary and tertiary markets that that we rarely if ever visit on our trips into the field. Each of our product groups also took a deep dive into long-term strategic planning, taking advantage of the added down time from travel, resulting in the launch of a wide range of new strategic initiatives.
So what will international business look like once the pandemic is behind us? We believe international travel, including trade shows and in-field visits with customers, will always be key ingredients in the export sales process. But the pandemic compelled us to embrace new technology and develop new paths to market that will serve us well in the post-pandemic world. So, while 2020 for us was not a great year by most conventional measurements, we feel good knowing that we came through it with our organization intact and better prepared to compete in the world that lies ahead.
Ed Dorian Jr.
January 8, 2021