Covid-19 - Impact on French Companies in China report
Organized by CCE Chine, French Chamber of Commerce, French Embassy, Business France, La French Tech and produced by NextStep Studio
Following our recent survey and our Founders' Resilience Index - February 2020, we were approached to assist several French organizations in China such as CCE Chine, French Chamber of Commerce in China (CCIFC), the French Embassy, Business France and La French Tech China.
We developed a dedicated survey targeting especially French companies located in China to see how they were handling the crisis and what was their perspective in the near future.
Download the full report (in English)
Télécharger le rapport (en Français)
466 business executives answered the questionnaire.
Among the companies represented, 38% are from the industrial sector and 62% are from the services sector.
The size of these companies in China:
Their dependence to a Group:
About a third of them are located in one of the quarantined areas like Wuhan.
RESUMPTION OF ACTIVITIES
The resumption of activities is understood as a capacity to recover 80% of historical orders in the same period.
About half of the companies anticipate a resumption of activities by the end of March, 2/3 by mid-April, but many believe that they do not have visibility at the moment.
Industrial companies anticipate a recovery closer than service companies.
IMPACT ON TURNOVER
The turnover for China for the first half of 2020 is, unsurprisingly, revised downwards, even if it is still too early for some to say.
Service companies are more likely than industrial companies to anticipate larger declines, up to 80% or even 100%.
IMPACT ON THE ACTIVITIES
Here are the main problems that French companies are curently facing.
CASH FLOW NEED
Three-fourths of the companies do not know how to estimate their future cash requirements to offset the impact of the crisis yet. This shows that we are still in the early stages of recovery and that it is difficult for most companies to measure their cash flow requirements.
For the 25% of companies that have visibility on the need for additional cash:
On VSEs and SMEs (a total of 104 companies have an idea of their cash flow needs), they reported a total cash flow requirement of 75 millions of euros. The average is different depending on the size:
Several French organized joined CCE France and the French Chamber of Commerce to produce this great report on the on-going situation.
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