The alarm sounded – now Elkjøp is cheering

Before the enormous extent of the crown crisis was seriously felt here in Norway in mid-March, dramatic signals were picked up from the rest of the world.

About 50 days after the first media reports about the outbreak of a “new and mysterious disease” in the Chinese city of Wuhan, the Stock Exchange was able to report on crisis conditions from various corners of the world:

Airlines had already canceled tens of thousands of flights. Casinos, shopping malls, cinemas and tourist destinations had been closed, passengers were isolated on board the cruise ships, and a large number of Chinese factories had closed or significantly slowed production.

It was announced that the latter would hit the electronics industry harder, also here in Norway.

Alarms: – We are working hard

Stocks of computers, mobile phones and televisions may last a few more months, but then stores will notice the shortage, Stefan Westerberg, a senior economist at the Stockholm Chamber of Commerce, warned in February.

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– Stocks are not infinite. Many depend on immediate supply chains, but today they are standing still or walking slowly, he said.

Elkjøp did not hide the fact that they followed the situation with concern.

But at the end of what has been by far one of the most demanding years for Norwegian business and industry since World War II, there is little in the numbers to indicate that the electronics giant was hit.

“We have a very strong result in a demanding year,” Fredrik Tønnesen, CEO of Elkjøp Norge, tells Børsen.

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You can point to a growth in turnover in the first half of 2020 of up to 20 percent, which is equivalent to 1.2 billion crowns.

– It’s not an everyday meal for us. It’s a rather unique situation that both we and the industry have found ourselves in since March. There has been a sharp increase in demand for the products we sell, so we will probably have some for free there, Tønnesen admits.

Electronics is among the industries that have done best during the crown crisis. It’s also expected to be among the winners in holiday shopping, along with other items that have done well earlier this year as well, such as food and beverage, discount stores, and online shopping.

– 2021 will be much worse than many think

– Crisis mode

It was by no means such figures that he had envisioned when the Elkjøp leaders gathered for a meeting in early March.

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During the meeting, they were actually going to talk about how they could be successful in the next few years. But with a global pandemic knocking on the door, all plans were turned upside down.

– It was an absolute crisis mode. This is probably the most uncertain period I have been through, says the manager of Elkjøp.

The man with more than 15 years in the industry thinks about questions like “Can we stay open? Are the customers coming? What will happen?”

– We had to plan scenarios with a 50 percent drop in the market, possible massive casualties, and how we would take care of employees. We were probably negative about what would happen, but the result was the complete opposite of what we expected.

Killed by the root of the package: – Lie!

Completely sold out

Because when Norway closed and countless Norwegians had to convert kitchen tables into home offices, a flood of customers followed who had to buy webcams, screens, computers and other equipment.

– There was also a huge interest in freezers and freezer boxes. There was not a single one for sale in all of Norway. So not only did drug paper accumulate, there was probably some food as well.

– Sold out soon

It quickly became apparent that many of the customers who suddenly couldn’t find their way to physical stores across the country continued the action online. On Elkjøp’s side, he has contributed to one of the company’s best periods.

– I’ve been in the electronics industry for almost 16 years and have never seen anything like it. The industry typically grows between 2.5 and 3 percent per year. Holiday shopping, shown from November 1 to December 12, shows a 45 percent increase in Norway. I’ve never seen it before.

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– we were lucky

But although Elkjøp can cheer up large numbers of people, there are businessmen and business players across the country who are asking for help in the event of a crisis.

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– Should it be strange to be able to refer to such figures, while many parts of Norwegian companies are fighting bankruptcy?

– Of course it is. We have clearly been lucky with the industry we are in. While tourism, restaurants and nightlife are struggling. We are very grateful that we are in the industry we are in, he says and at the same time adds a tribute of his own:

– I have to boast of the 4000 souls and colleagues in Norway who have gone through this period.

The company has a bonus scheme that is directly linked to the sales figures. This year has given good sums to the employees of the company, we must believe the top manager.

– Never before have we paid as much in bonuses as we had until March and until now.