Foresighted companies invest in development even in times of crisis

It is quite surprising to see that SME-s have reduced their spending on material handling equipment less substantially than large enterprises. Regarding spending on warehousing software, the situation has not changed with logistic centres spending as little as possible. In the opinion of Bálint Kövecs, director of Axiál kft, companies should accept the fact that investment is needed in material-handling-warehousing technology in order to remain competitive. Axiál Kft. has recently opened a new centre for used machinery in Csorna and plans to open another one near Budapest later this year. However, it has become more difficult to get financing for such equipment as well. This means that equipment rental is becoming more popular as an alternative to purchasing. According to Bálint Kövecs, they need to provide a complex service to support the operation of the equipment supplied for their customers, including a reliable and fast supply of spare parts and repair services which are available in 14 locations nation-wide. At the same time, a number of financial services are also provided by Axiál Financial Services Kft., while Manax Kft. provides equipment rental services. Though companies have become very cautious with new investments, interest in new IT solutions which help to optimise logistic processes is growing. At present, Hungarian logistic centres are very poorly equipped in terms of software, spending only 0.23 percent of their annual revenues on IT projects, while this figure is 2-3 percent in western Europe. However, they are satisfied with the current standard of their IT systems. According to János Mondovics, managing director of the Logistic Development Centre, they have contacted ten logistic service providers to offer co-operation, but finally all of these decided not to invest in IT owing to the bleak financial prospects foreseen for this year. In his opinion, refusing to spend on development is a hazardous strategy in the long run.