Europe 2025
Naturally, the current economic situation in Germany, as well as that in Europe, is heavily on my mind. After all, I am a business owner who is responsible for 430 employees. What I am missing, however, is a clear political direction in terms of the economy. Does our European policy have any answers?
Let me put it this way: As a medium-sized entrepreneur in the year 2025, I have a plate full of challenges every day. We must constantly ask ourselves the question, how do we make our business even more sustainable? Sustainability has long since ceased to be a trend and has become something of a must.
Digitalisation is another hot topic. Whether that means automating processes, upgrading our IT infrastructure or sensibly implementing AI – you cannot afford to simply do nothing. At the same time though, we are struggling with heaps of bureaucracy. It would be so nice if the regulatory jungle would be streamlined a little, so that we do not need to battle mountains of paperwork each month. And no, I don’t mean in the sense of Elon Musk.
Then there is the matter of the skilled labour shortage. The demographic change is real, and it is beating down our labour market. On a European level we are discussing migration, but the discussion is (more or less) one-sided. It is an important discussion, but it must be comprehensive and not only conducted in a one-dimensional way. How do we deal with this change and how do we attract qualified specialists? This is a relevant factor in remaining competitive.
And, as you already know, we think outside the box: Geopolitical uncertainties and an ever-changing global playing field require us to remain flexible and agile. Whether it is retail, customs duties, energy prices or international conditions of competition – we must have Plan B ready to go – economy and politics together.
In short: Europe 2025 offers us many challenges but also enormous potential. European entrepreneurs want to lead the way and shape the future, but we need sensible framework conditions and planning security from politicians!
Distribution Mechanics: Reservation Costs and Inventory Pre-Financing
For large purchase volumes, our vendors generally grant special prices, known as »project prices«....
For large purchase volumes, our vendors generally grant special prices, known as »project prices«. When we receive a project order from one of our resellers, we typically reserve the available stock until the agreed delivery date and order any missing goods from the vendor.
What »some« may not realise – and what »others« might consider commercially absurd – is this: we always purchase the goods from the vendor at the same price, namely the standard distribution purchase price. If, for example, our purchase price for a printer is €100 but the project price is only €50, we actually sell the product at €50 below our own purchase price.
Naturally, once the project has been delivered, the vendor reimburses us the €50 difference. So far, it’s fair.
However, if the delivery stretches over several months, we finance the full €100 value in the meantime. While the system integrator has sold 10,000 printers for €500,000, we are carrying inventory in our warehouse worth €1 million – because we have paid for it upfront.
That explains why distributors always push for projects to be delivered as planned and not postponed 20 times by the end customer – because that is very expensive. With the typically slim distribution margins (yes, here comes the usual complaining), financing costs can easily »eat up« the entire margin within just a few weeks.
With our resellers, this is rarely an issue: they generally only place orders with us once they have received a firm order from the end customer.
It becomes amusing – and particularly costly – when a vendor says: »This project is definitely coming the week after next. Unfortunately, the end of the quarter falls in between, and we need to place the goods into your warehouse tomorrow – so please hold them for now.«
In the best-case scenario, it works out. In the worst case, the reseller is not even aware of the project yet, and the end customer has not fully committed to the vendor. We have seen it all before. So at Jarltech, we have become somewhat more cautious in such situations. Of course, it is part of our job to anticipate deals from time to time – but buying »hot air« indefinitely is not a sound strategy either.
So please have understanding if our sales or purchasing teams occasionally ask a few more detailed questions about the actual status of a project. Because remember: pure »hope« can be expensive.
Safety gone mad: Health & safety thinks we’re all half-wits!
…or at least incapable of surviving on our own....
…or at least incapable of surviving on our own. Health and safety is important, no question. Safety comes first. But there is such a thing as taking it too far.
Here’s the showstopper right at the beginning:
Our colleagues in the purchasing department are now required to wear safety goggles (eye protection) when leaving their desks. Reason: There are plants in the department with sharp-edged leaves. (Pause.) Seriously?! Yes, seriously. That’s pure slapstick.
Another good one: Our facilities team has just cleared snow. But careful! Cones must be placed around the area where the shovelling is taking place. Someone might otherwise walk into the moving shovel. Quite honestly, anyone not looking where they’re going could just as easily trip over a cone.
And in the kitchen, washing-up liquid has to be locked away. Dishwasher tablets? May only be used by people who have received proper instruction. So yes, that means training for dishwasher tablets.
Desks tend to have corners. Highly dangerous! Therefore, every corner must be fitted with rubber protectors.
Are we in nursery school?
Is it even worth getting worked up about it anymore?
At least that was all within the company. In our private lives, on a construction site, work was immediately halted. Reason: Outside temperature below five degrees Celsius, and the portable toilet wasn’t heated … In a comfort-obsessed country I can almost understand that. I hadn’t even thought about it because I didn’t know heated ones existed. I had it replaced. But do you really have to stop construction over something like that?
I fear the health and safety brigade will soon be paying a visit to our restaurant as well. Without chainmail gloves, handling knives will probably be banned. For guests too, since steak knives are clearly instruments of the devil.
Enough on that subject. I’m going home now, hoping I don’t trip over the dog. He’s stubbornly refusing to wear a high-visibility safety vest.
(Not satire.)
Distribution Mechanism: Price Protection
We are currently in a phase where manufacturers are significantly increasing their prices....
We are currently in a phase where manufacturers are significantly increasing their prices. And not just once – we expect prices to rise several more times this year. They may then fall.
It has reached the point where some manufacturers only calculate once an order has been placed and then state the price at which they will accept it – the price is then valid for one day. This is somewhat reminiscent of the coronavirus period. However, there is no alternative – we must persevere. The change is clearly most significant for relevant end customers who plan rollouts of thousands of devices over months and want planning security. That is no longer possible – ordering and accepting delivery is the only solution for price security.
Of course, this often leads to the question: »You still have devices in stock that you bought at the old price. We want to get them at a discount too.« – and that is a false conclusion.
In distribution, there is a mechanism called »Price Protection«. This is supposed to protect us from price reductions: If a manufacturer lowers the price, we receive a refund for any items already in stock. »Unfortunately«, it also works the other way around: If a manufacturer increases its prices, we must pay the manufacturer extra for goods in stock. This could result in a bill amounting to several million. So, as you see, we don't have any »cheap, old goods«. Due to frequent price changes, it is also possible for a particular device in our inventory to be repriced several times. While this is a minor nightmare for our inventory management, it is ultimately fair and the only solution.
Live: Watching Bureaucracy Being Born
It came to pass in the cold January of 2026 in Berlin that the power went out....
It came to pass in the cold January of 2026 in Berlin that the power went out. A district of 48,000 inhabitants was cut off from the electricity grid for several days. According to a claim of responsibility, this was thanks to an attack by a left-wing extremist group – which, of course, only wanted to hit the power companies and by no means the citizens. As a minor side note, the Lord Mayor was caught playing tennis instead of attending the crisis task force. But hey, I digress.
Political response: Critical infrastructure in Germany must be protected better, IMMEDIATELY. Police, cameras and other suitable measures.
What happens next: A working group is convened to consider how this can be implemented in the long term. Initial outcome: questionnaires are to be sent to all »important« companies in Germany, asking them to explain how they protect themselves and how their infrastructure is to be safeguarded.
Well then, please make some popcorn and watch to see whether my prediction of what follows comes true:
- The questionnaire will be five pages long.
- The working group will become a commission.
- This commission will then become an authority.
- The group of people receiving the questionnaires will be expanded significantly. Failure to complete the questionnaire will be punishable by fines and, in the most serious cases, imprisonment for company directors.
- The whole thing will be cast into law.
- The questionnaire will grow to ten pages.
- Next, a certification will be introduced: »Infrastructure-resilient enterprise«.
- These certifications will be carried out by monopoly bodies within the German economy, i.e. TÜV (Technical Inspection Association) or the Chamber of Commerce and Industry (IHK).
- This certification will become mandatory and will also be part of the scope of statutory audits.
- Every company with ten or more employees will be required to appoint an Infrastructure Officer, who will have to attend regular training courses.
- Funding for concrete measures will, of course, come from the special fund »National Defence«.
Completely wild imagination:
- Private households will be required to stockpile specific amounts of food and water. Those unable to afford this will receive a state subsidy (from the special fund).
- This will be verified every two years, with inspectors granted extensive powers.
- Companies will also be required to stockpile certain quantities of fuel, which will naturally involve the fire safety authorities.
In practical terms, nothing will change – but if something does happen, at least we'll know what we could have done. 😊