German toilet paper manufacturer Hakle has gone bankrupt. In fact, the Dusseldorf-based company has announced its insolvency, reported Spigelian September 6 In question, “the massive increase in the costs of supplying materials and energy” and the increase in transportation costs. “Toilet paper is very bulky and therefore the costs are enormous. We are windy, so to speak,” said the director of the paper industries federation Gregor Geiger, questioned by Release.
The manufacture of toilet paper and paper towels requires a large amount of energy, which is used in particular to dry paper pulp, making the industry highly dependent on gas. However, Germany has seen its price skyrocket in recent months. “The entire paper industry is under enormous cost pressure,” Gregor Geiger confirmed to the German newspaper. An additional cost that must be compensated with a price increase so as not to undermine the solvency of the companies.
A dynamic demand
Driven by a sector with dynamic demand, the toilet paper producer did not show bad results, however. In 2020, Hakle generated 650,000 euros of profit in 2020 for a turnover of 80 million. According to market research firm GfK, sales in the food retail paper industry, which includes tissues, toilet paper and paper towels, in June far exceeded those of the previous year. Just behind toilet paper (36.2%), toilet paper sales were up 27.8%.
But the Düsseldorf manufacturer was unable to pass on these cost increases to its selling prices. “Negotiations with distribution have never been so difficult,” confirmed Gregor Andreas Geiger to Release.
Bankruptcy and shortage risks
Difficulties related to the cost of energy and supply pose a risk of shortages in the sector in the long term. “If prices continue to rise, soon we will no longer be able to guarantee supply,” warned Martin Krengel, vice president of the professional federation, in the columns of Release.
As for bankruptcies, they could multiply in the coming months, across the Rhine. And toilet paper makers aren’t the only ones struggling with rising production costs. Energy-intensive bakeries are also struggling to pay their bills. “The disappearance of the bakers will continue,” Armin Juncker, president of the German Federation of Bakers (VDG), predicted. Release.
The number of bankruptcies, all sectors together, has already increased by 26% in August compared to the previous year, according to the Leibniz Institute for Economic Research (IWH) whose figures were assumed by the spiegel. An ascent that should accelerate in the fall. According to the same source, their number could still increase by around a third next October compared to October 2021.
Source: BFM TV
