Page 23 - Hoftex Annual Report 2018 EN

Moreover, our research and development team is always exchanging ideas and information with its internal customers in the Group. This offers us the opportunity to network and transfer knowledge within the Group and target the relevant markets, products and solutions to ensure the future success of all of our subsidiaries.
The Hoftex Group is highly dependent on raw materials procurement and is therefore exposed to some risks in the procurement market. Fluctuations in quality and price generally pose the greatest risk. In the Hoftex Group’s divisions commodity prices are subject to regular fluctuations. The general in- crease in the global demand for raw materials means that prices are always rising. The Hoftex Group hedges its risk of quality fluctuations by continually monitoring its suppliers. The procurement team works closely with the respective suppliers and is always looking for development opportunities to minimise procurement risks on both sides.
The close collaboration between our procurement team and our suppliers enables us to take advan- tage of the future opportunities afforded by the growing trend towards transparency as it relates to sustainability in the value chain.
New production technologies made even more effective by digitalisation are an incredible opportunity for us. Connecting our production across all of our sites could enable us to use data analysis techni- ques to produce in an even more efficient and prudent manner, improve quality and achieve cost savings.
Purchasing/Procurement
There are many demand-related opportunities and risks that could be significant for the Hoftex Group. Negative reports on textile industry activities in general and the automotive industry in particular could dampen our customers’ buying behaviour. At the same time, positive reports in the media could present opportunities for subdivisions and the entire Hoftex Group.
The race to recruit highly qualified employees and talent for specialised fields such as digitalisation and automation in production continues unabated in the regions in which we are active and in the textile industry in general. There is a risk of employees leaving the company in general, which would result in a loss of expertise in production and administration. Digitalisation and new technologies give us the opportunity to retain employees by offering them an interesting, modern and flexible working atmosphere, to motivate them and to find new candidates and get them excited about working for us.
Production
Sales
Personnel
Letter to Shareholders Supervisory Board Report Group Management Report Consolidated Financial Statements Annexes
Hoftex Group production depends on detailed, forward-looking planning. Deviations from the plan due to internal or external forces such as supplier delivery delays or change requests received from customers on short notice can lead to the risk of production delays. This in turn can result in over- production or underproduction in selective cases. Close communication between the respective pro- duction facilities and our international positioning enable us to shift production capacities within the Hoftex Group as needed. This allows us to respond swiftly to problems in order to mitigate the risks mentioned above. Furthermore, production must always be able to anticipate quality, safety and environmental risks. We have the right management systems, occupational and environmental safety training courses and corresponding insurance policies to counteract these risks.
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