The introduction of new company software has been blamed for mixed half-year results at lubricant manufacturer Liqui Moly.
Problems with the suite have had a ‘direct impact on business relations’ according to the company, leaving customers frustrated. “In my entire professional career, I have not had to apologize so often to customers, as I have had to in the last six months. The level of service that we are currently delivering really pains me,” says Ernst Prost. The company is also incurring considerable extra costs, for example, because containers can only be half filled, delivery vehicles have to wait longer than planned to be loaded, or air freight needs to be used when items that are needed urgently do not arrive by ship in time. “It’s not our customers’ fault that we are having problems, so we are doing everything we can to minimize the impact on them and to bear any additional costs.” These expenses are not the whole story either. “In addition to the huge cost of having the software installed, every day produces new things to trouble shoot and problems to solve.”
All of this has left significant tracks in the company’s figures. Compared to the first half of 2018, turnover has fallen slightly by 0.8 percent to € 259.6 million, and this is only because the high backlog of orders cannot be fully processed due to the computer problems. Earnings for the half-year fell by around 30 percent to € 11 million. “I never would have thought that in 2019 a change of software could send a whole company skidding off the road” concluded Prost.
The company hopes to have the computer problems under control, and a new central warehouse in action, ‘by the end of the year at the latest’.