Paulson Manufacturing Mitigates Supply Chain and Pricing Challenges
Paulson Manufacturing relies on its German distribution center to help mitigate supply chain and pricing challenges
We reported on Paulson Manufacturing Company, based in Temecula, California, three years ago. The company manufactures a complete line of custom-crafted arc fault face shields, goggles and accessories to provide worker protection in high-risk situations throughout the world.
Roy Paulson, President and CEO, established a distribution center (DC) in Germany to satisfy growing demand in Europe. He sells directly to other parts of the world from his California manufacturing facility.
As Mr. Paulson explained, “We sell from our manufacturing facility here directly into our Frankfurt DC. We initiate invoices with the price, duties and VAT and anything else required and ship container loads to our German facility.”
The company’s DC people there, under the guidance of Managing Director Bjoern Krempel, sell directly to Paulson customers throughout Europe.
The German DC facilitates minor assembly such as labeling and repacking for specific European customers although most products exported come fully assembled. Paulson had its best years during the Covid pandemic due to its special and unique products, along with its continuous efforts and strong relationships with its customers.
We asked Mr. Krempel how its European operation was able to stem supply chain issues. He replied, “We have enough stock in our current inventories to get through this crisis. As we fill up our inventories throughout the year in anticipation of future demand and economic events, we are able to remain independent of most turmoils.”
When asked about current sales, he responded that, “sales and shipments are reasonably good at this point, although the political situation in Europe, primarily due to the war in Ukraine, has had a negative impact on our industry as well.” On the other hand, as of this writing Paulson just shipped two containers to its Frankfurt DC.
“So far, we have maintained our current pricing strategy despite the falling value of the euro and inflation,” Mr. Krempel noted. “However, the weak euro against the US dollar will affect our profits if the situation continues, as our purchasing prices get higher. Our plan is to keep prices low, even in the current economic and political crisis. We face more competition from Far East manufacturers who are able to maintain extremely low prices.”
Despite this, Paulson Germany has been able to maintain its customer sales with its high-quality product standards and rapid deliveries from the US and Germany. “If we stay on top of new product designs and development, we are positive that we will remain a global leader in eye and face protection,” he continued, “But if inflation progresses, we may have no choice but to adapt our pricing to compensate for so many negative variables.”
“With Paulson International being in business now for 18 years, we have seen many difficult times and even deeper crises in the international market. One thing we have learned is that it is essential to always remain positive and keep pushing for new orders and customers. A crisis is also always an opportunity for the undaunted,” Mr. Krempel concluded.
For more information on the company, visit www.paulsonmfg.com.