From David Power – President Exact Medical Manufacturing 

 

Summary Notations

 

As this is currently becoming a major news story, China is experiencing their worst energy crisis since 2011. The crisis is manifesting itself with a lack of available electric service in many parts of the country.  The Province of Jiangsu and the City of Changzhou, where Exact Medical is located, is experiencing significant shortages and problems.

 

The reasons for this situation have several main causes.

 

Because of this crisis situation, our local government officials have taken the following steps to reduce power consumption and mitigate the situation.

 

Because Exact Medical employs a large number of people with over 750 employees and we are also considered light industry, Exact has been classified as a Group A company. (i.e., supporting a lot of citizens income with minimal use of electric).  Having strong positive relationships with the local Government, these being managed by my wife Xiao Ping, has also aided our status.

 

The Government has then set a schedule of operations per the below

 

So, starting this week there are many manufacturing facilities closed near us, and as a side consequence, our front gate is besieged with people from reduced production factories inquiring if Exact Medical is hiring as they hope for full time and not their current part time employment.

 

Another area of concern, of course, is the availability of raw materials. As much of our material such as PE, SMS, PSB and such requires production equipment that are high users of electric, this is of course an immediate concern.

 

First, as a result of the pandemic experience, Exact Medical has taken the position of maintaining a minimum of 2 months safety stock of critical raw materials so we of course have no immediate concerns.

 

In addition, Exact has communicated with all of our raw material suppliers and any fears have been put to rest. Many of our suppliers have been classified as Group C companies, with 15 operating days per month.  However, from the beginning so many years ago, Exact has done business as a stable, consistent and loyal customer to all of our suppliers and having built those relationships over a couple of decades, we are in true partnerships with those companies.  They are responding now with assurance that Exact will receive our needed supplies as the first company they will ship to during their allowed days of operation.

 

In times like this we recall that the Chinese Symbol for Disaster is actually the combination of two symbols. The first being Danger and the second being Opportunity.  We view the current crisis and situation as equal parts danger and opportunity.  Reduced production in China hopefully will have a positive impact on the logistics crisis and challenges we all face now. In addition, Exact Medical has positioned itself over the years in design and relationships to weather almost any storm that presents itself, and we are well positioned to handle this crisis without unpleasant effect.

 

I will continue future communications as circumstances change and/or warrant.

 

With Best Personal Regards,

David Power

President

Exact Medical Manufacturing