Interview with Rolf Sorg, Founder and CEO of PM International AG
AmCham: Please share with us how you and your team became aware of the Covid medical crisis and what were the initial first steps that PM took to protect the company, the employees, and the customers? and what adjustment to physical working schedules and conditions, and what health and safety measures have been implemented to ensure the physical safety and health of your employees? How have you implemented home working and what challenges have you had to overcome in that regard? and how would you assess the current emotional and mental health of your employees and are there any steps you are taking to give additional support in this area?
Rolf Sorg: I am proud of our team that reacted very effectively and quickly to the situation in early 2020. We grasped the magnitude of the situation and decided very early to heavily expand our company’s IT infrastructure and equipment. We reacted quick enough to get mobile devices in time – thanks to the decision-making of our management and crisis teams. This helped us a lot in adapting to the situation and ensuring the safety of our employees while staying fully operative. Our teams are working closer than ever and are supporting each other. Our company is about health, fitness, and wellbeing, and I will always make sure that our employees will feel that and benefit from our success.
Well before 2020, we decided to start the process of fully digitalizing our business, giving our distribution partners and customers the chance to both work from wherever they want, and order from wherever they want. It was great to see the burning desire and consistency of our partners in the past months and I am very proud of all of them, they are giving their best every single day.
On a broader level, we also donated more than one million Euros to Covid relief efforts across Europe during the first wave in 2020. I wanted to make sure to help everywhere we could, and we distributed protective gear and supplies to frontline workers, hospitals, police, and fire stations when the supply situation was really dire. We also supported social care centers with food to help them out. This was something important to us because we were all in this together and we wanted to contribute and do our part!
AmCham: How has business demand from your customers changed during the crisis period?
Before the current situation, we saw wellness already emerging as one of the main consumer spending opportunities. Due to the pandemic, this development has accelerated, and we register an increased interest in topics around prevention and a healthy lifestyle. Also, our digitalization plays a huge role today and will be a decisive factor in the future. Almost every aspect of living is happening online these days. Our distribution partners adapted very quickly; they appreciate the opportunity to create an extra income with no risk, the freedom to choose their work time, and the ability to have fun while doing so.
We, in fact, managed to make 2020 the most successful year in our company’s history. This year, we were recognized with the Bravo International Growth Award as the fastest-growing international direct selling company in the industry ranking Direct Selling News Global 100, which means a lot to us in this particular year.
As a result of our digital transformation and our distribution partners’ shift towards working fully online, we see that distances and borders have even less significance now. As a result, there are massive savings in travel time and costs for our distribution partners, which will have a major impact and increase their income going forward.
AmCham: Has there been disruption to the logistics stream from your product manufacturers and how have you handled disruptive supply flows?
When the crisis started and the first lockdowns were announced, we were absolutely alarmed. First, we made sure that all internal operations will not be affected by the measures imposed. Internally, our supply chain management reacted extremely fast with mobile working solutions (e.g. home office) so that daily business was guaranteed and the performance could be stabilized. Luckily, also our suppliers and manufacturing partners acted fast, took the right decision to keep their businesses running.
What helped us a lot in this context, was setting up a 12-month rolling forecasting system with all our suppliers, such as contract manufacturers and packaging suppliers. That allows every player to plan demand & supply much better in advance and to build up adequate safety stocks without too high financial implications. As a result, the supply proofed to be absolutely stable.
AmCham: How has the impact of Covid evolved over time and what adjustments has PM had to make to protect the company, the employees, and the customers?
I am very proud of our corporate team and distribution partners around the world, who have shown a lot of commitment, flexibility, and leadership. We have taken on the challenge and evolved together.
When the pandemic started last year, our whole industry had to face major challenges overnight. When distribution partners were stuck at home during the lockdown of the first wave, we could make it able for them to still support their customers through our customer direct program. We reacted extremely fast, created additional tools, and offered immediate free delivery for customer orders from 50 dollars. All of this created a real motivational boost throughout our teams, particularly for our many young distributors who are digital natives and already had a lot of experience working online. That made it easier for us to adapt and go fully online, wherever and whenever it was needed. It really felt and still feels like we’re taking this challenge on together, solving the problems in our way. Every time the situation changed, our partners seemed to be motivated even more to make the best out of their situation and help others to do the same. This is a core value of PM-International: Keeping a positive focus and thinking solution-oriented.
AmCham: As a company, have you been satisfied by the adequacy and timeliness of the actions taken by the various governmental entities with whom you are involved and were there some solutions imposed in some jurisdictions which you greatly appreciated or some that you considered ineffective? And what additional governmental policy initiatives would you have liked to be implemented? and please comment on the sufficiency and effectiveness of the governmental financial support measures made available to your company? Were these measures adequate? What challenges do you face now that the economy is recovering and how is this “new normal” the same or different from the old normal?
The challenges are not behind us. While we are glad we got through 2020 and 2021 without any major issues, the full picture of possible effects on global supply chains will only reveal in the next 12 months. Here, staying flexible and anticipating possible challenges is key.
At the same time, the new normal is ahead of us. 2020 paved the way for our future working and growing. Right now, we are focusing on reaching the second billion in sales. Our goal is to continue sustainable growth to create worldwide opportunities also for future generations.
AmCham: What have you learned and how has your personal management style evolved as a result of this Covid experience?
I always valued the flexibility of a family-owned business, that’s one of the things I am most proud of when talking about PM-International. As a family-owned company, we make decisions based on our values and principles, and not just for the next quarter. We adapt quickly with the needs of our distribution partners and customers in mind and provide them with the tools to set up their success. Because in the end, their success is our success. Our company was always about that, but in the past 20 months, this was more important than ever. I am grateful for the trust of so many business partners and it makes me proud and happy to see the results of their work and celebrate their successes with them.
AmCham would like to thank Mr. Sorg for this insightful interview!