Casartigiani, Director of Tirozzi: Veneto is better than others, but more than 40,000 companies are thinking about a survival strategy

The economic system of the Veneto region, according to the latest estimates of the most reliable Italian observers (Unioncamere, Confindustria), in spite of everything, “held the blow.” Indeed, the data suggests that Veneto has responded better than other Italian regions, and we can’t help but rejoice. However, we know that the economy consists not only of statistical data, but also of balance sheets. In any case, the economic situation worsened. Again, just as during the pandemic, the condition of business is especially worrisome, and certain actions are lacking at a moment of national emergency, which should neither be underestimated nor postponed. Decisive and structural measures are needed to avoid the blocking of handicraft enterprises, which has already begun. In this situation, we estimate that more than 40,000 companies in the Veneto region are thinking of survival strategies, including closure as an option; it is an ever-present possibility that all of us, primarily associations, always have to deal with.

Among other things, in our opinion, the methods, which the state once again adopted in order to distribute resources between companies affected by the pandemic and this time by the geopolitical crisis, proved inadequate. I am particularly referring to contests and funds that mandate companies to make unlikely “click days” (clearance days) or impose very strict requirements, perhaps with the exception of those companies that, although not energy intensive, have suffered and still keep suffering from the consequences of higher energy and raw materials prices or current trade restrictions.

Among the companies that are part of our structure and the ones we represent, we estimate a decrease in total turnover by about 20%. These are important figures for small and medium enterprises that have trained for years their already modest staff to work with certain markets.

They have a strong influence on relations with the countries involved in the conflict, even indirectly. One of the consequences is the need to look for alternative solutions, such as working with other countries in the Eurasian bloc. As evidence of the resilience and adaptability of Verona companies, I can only mention the latest report from the Analysis and Research Service of the Verona Chamber of Commerce, updated as of March 2023, according to which Verona exports are clearly improving compared to the same period of 2022 (+12%), positioning themselves higher than the averages for Veneto (+9%) and Italy (+9.8%). However, as for the countries to which Verona’s small and medium-sized enterprises export the most, we have Germany, France, the USA, and Spain in the top positions in the general classification. Among non-EU countries, Russia and China lost many positions.

Over the past two years, using our regional system and our Confidi – Fidi Artigiani Verona – Casartigiani Verona has created a real target group for supporting Verona companies, a target group that has achieved good results and intends to continue in the same vein. On the one hand, we constantly listen to their requests and needs through our trade committees, and on the other hand, through our privileged observers and our legal, banking, finance, and accounting professionals, we try to anticipate decisions that will change the financial statements of companies. Businesses are constantly looking for solutions in the following areas:

1. Support in finding new markets and business opportunities outside of conflict zones.
2. Access to funding for supporting business activity to deal with turnover fluctuations. The contribution of a structure such as Confidi is important: it can not only facilitate access to a bank loan by providing guarantees, but also mediate both in dialogue with the bank and in the collection, processing, and transmission of documents necessary for the preliminary analysis of a loan request.
3. Assistance in adapting to new market conditions and diversifying sources of supply. We constantly analyze market dynamics in order to be able to provide companies with timely and truthful analysis and offer effective solutions. We are also on the path to renewable energy communities.
4. Participation in business networks that offer opportunities for collaboration and information sharing.
5. Compliance advice. Through seminars, training events, and special consultations, our association system meets with many companies to make them “correspond” to the overproduction of rules and laws, both at the national and at the European level; with companies that risk blocking the activities of companies that do not have internal staff trained in all disciplines (not only import-export, but also procurement, sustainability, confidentiality, etc.).

At the end of last year, Unioncamere Veneto released a report (La Clessidra) that, starting with the phase of the global crisis due to the post-pandemic, geopolitical, and energy scenario, showed a picture that was clearly improving and emphasized that companies have never backed down, they have done their part by demonstrating that they are also aware of their social role in relation to families and workers. From this standpoint, especially in energy-intensive sectors, companies were able to manage factories wisely and carefully, they tried to grow in the domestic market or in new foreign markets. I can only share this approach: today, if we consider all contractual forms, employment is currently holding steady, if not improving. For handicraft enterprises, the problem, perhaps, lies elsewhere, namely in the lack of a labor force specialized for some industries and unqualified for the others. In fact, it is a difficult problem between the demographic decline and the attractiveness of craft work, very creative and autonomous, which, however, struggles to enter the selection of the most qualified young people.

It is relevant. The monetary tightening of the past few days to reduce the impact of inflation imposed by the ECB risks is dragging our country’s productive realities into the abyss, seriously harming families and businesses that are forced to rely on bank loans to finance themselves. On this issue, I can only support the most recent statements by Andrea Prando, Secretary General of Casartigiani Veneto, according to whom “in a phase as delicate as the one we are experiencing, raising interest rates risks jeopardizing the investment capacity and medium-term prospects of many small businesses. Lots of companies have resumed payoffs after renegotiating the terms of the loans issued in the midst of the health emergency, although business volumes and turnover are struggling to return to pre-Covid levels due to current difficulties.” A significant growth should strongly add to the well-known and steady increase that, amid soaring energy prices and rapidly rising commodity costs, has characterized business and household balance sheets across the board in recent months.

Eurasia is certainly characterized by a large and diverse market. Clearly, foresight and strategy are the two elements necessary to enter new markets or new suppliers. It is also important to rely on experts in the sector, given the political and economic uncertainties related to Eurasia, always conducting a thorough risk and opportunity analysis.

The Eurasian Forum can and should continue to develop economic cooperation between the countries of the region.

Digitization and innovation can play a key role in improving the efficiency and competitiveness of Veneto businesses. In our opinion, there are still too many small and medium businesses in Veneto outsourcing the management of ICT functions. Therefore, it is necessary to invest in internal staff training to be able to understand the oncoming challenges and keep up with the world’s most dynamic economies.