War is a few hours from John Lynch’s doorstep.

Russia’s military invasion of Ukraine, reportedly the largest-scale conventional military attack since World War II, is personal for Lynch.

An American, he moved to Poland more than 30 years ago and became one of the first expatriates to launch a start-up in Eastern Europe following the fall of communism – Lynka, a promotional products supplier specializing in logoed apparel. Just a few hours from Poland’s border with Ukraine, the Krakow-area company counts hard-working Ukrainians among its employees.

“Meeting with our Ukrainian staff one day after the invasion, there were lots of tears and looks of shock on people’s faces,” said Lynch, who first came to Poland as a volunteer in a U.S. aid program created to assist the then newly free economies of Eastern Europe.

Lynch continued: “Since many Ukrainians are in basements and bomb shelters, and there are power outages, mobile phone coverage is spotty, making it difficult to contact people there. Our employees are naturally worried about their families back home.”

A local Polish high school teacher Lynch knows shared that the day after the invasion, two of her female Ukrainian students were badly shaken.  “Their fathers – who were safe and sound living in Krakow for a few years – were heading back to Kyiv by car,” Lynch explained. “They felt they simply had to return to defend their motherland.”  

Promo Europe’s Reaction & Response

Throughout Europe, promo products leaders like Lynch and their teams are contending with the personal and professional impacts of the war that began on Feb. 24 when Russia’s military invaded neighboring Ukraine. They’re casting anxious eyes east as Russian President Vladimir Putin’s forces press forward with their attack, bombing cities and killing civilians as they go but encountering fierce resistance from Ukrainians fighting to maintain their freedom.

“We Europeans are shocked and deeply concerned about this unprovoked attack on the Ukraine and on democracy itself,” said Ralf Oster, CEO of Netherlands-based PFConcept, the European arm of supplier juggernaut Polyconcept, parent firm of Top 40 supplier Polyconcept North America (asi/78897). “Our thoughts and prayers are with the Ukrainian people.”

Tobias Roesch of Elasto Form KG, a large supplier based in Germany, promo’s biggest national market in Europe, has connected in recent days with colleagues in Kyiv.

“They are fighting for their country and asking for help and support from the western countries with humanitarian aid, weapons and sanctions against Russia,” said Roesch, prokurist and product manager at Elasto Form. “We are shocked about the happenings in the Ukraine. Everybody is scared about what happens next,” Roesch continued. “It seems that a huge anti-war movement is starting in the public (throughout Europe) and everybody stands together against the war.”

“Several of (our Ukrainian employees) left to return to Ukraine on the day after the invasion began. We are worried for their safety and have heard little from them since they departed.” John Bruellman, Showdown Displays, on Ukrainian employees based in the firm’s Czech Republic facility.

Promo firms ASI Media spoke with, whether based in Europe or headquartered in the U.S. with European operations, said that so far there has been virtually no bottom-line impact to their businesses in areas outside Russia, Ukraine and Belarus, where few conducted significant sales even before the conflict.

While economic fallout like accelerated inflation and other potential business issues are a concern, for many promo pros the immediate focus is on the humanitarian situation and their Ukrainian colleagues. Some companies are stepping up to help.

Stricker, for instance, is sending two trucks loaded with food and first aid products to Ukrainian refugees escaping their war-torn country by fleeing to Poland and Romania. Saying that Europe is experiencing its biggest humanitarian challenge since World War II, the Portugal-headquartered supplier is also opening 100 full-time jobs within its Brno, Czech Republic, production facility specifically to Ukrainian citizens.

Attack on Ukraine's second largest city, Kharkiv, a "war crime", says President Zelensky https://t.co/n5iK9z4Kuk

— BBC News (World) (@BBCWorld) March 1, 2022

“The entire situation in Ukraine firstly generated a strong wave of shock since the majority of Europeans were not truly expecting war to occur,” said Alexandre Gil, Stricker’s chief strategy officer. “After that initial 48-hour impact though, there has been a truly remarkable reaction of humanitarian support to the thousands – and in short time – millions of Ukrainians that have been impacted by the conflict.”

Lynka is stepping up, too.

As just one example, the company plans to hire up to an additional 50 Ukrainians to work in its production facility in Poland. Direct aid is also on the way to Ukraine. “At this moment, some employees of ours are driving in a convoy to the Ukrainian border to deliver clothes, blankets and even toys for children,” Lynch said. “It’s incredible how many people and companies are helping.”

“We employ many Ukrainians at our facility in Poznan, Poland. Many of these teammates have families in the warzone and are deeply concerned for their loved ones.” Ralf Oster, PFConcept

Meanwhile, PFConcept is organizing donations of blankets, winter jackets, monetary contributions and more to aid organizations that will provide such essentials to Ukrainians in need. The company is also offering mental-health support to its Ukrainian employees, among other initiatives. 

“We employ many Ukrainians at our facility in Poznan, Poland,” shared Oster, ASI’s 2017 International Person of the Year. “Many of these teammates have families in the warzone and are deeply concerned for their loved ones.”

Such anxiety is rife among Ukrainians who work at Top 40 supplier Showdown Displays’ (asi/87188) factory/European headquarters in the Czech Republic.

“Our employees are deeply concerned,” said John Bruellman, CEO of Minnesota-based Showdown Displays, whose European operations also include offices in Spain and the Netherlands.

“Many of them still have immediate families in Ukraine,” continued Bruellman, a member of Counselor’s Power 50 list of promo’s most influential people. “Several of them left to return to Ukraine on the day after the invasion began. We are worried for their safety and have heard little from them since they departed.”

Attacks on 🇺🇦 civilians, hospitals, homes, schools.

Hundreds of thousands forced to leave their homes.

Neglect of nuclear safety.

Today, shelling of #Kharkiv.

We must document these horrors in Putin's war. They are war crimes, and should be called and investigated as such.

— Kaja Kallas (@kajakallas) February 28, 2022

Showdown Displays’ Czech colleagues are also racked with anxiety. 

“Many of them remember life under the Soviet system,” Bruellman explained. “They generally are distrustful of the Russian government, and they would do anything to prevent a return to those days. Some of them are convinced that the Russian advance will not stop with Ukraine. It weighs very, very heavily on their minds.”

To help, Showdown Displays has made sizeable contributions to the Czech Republic chapter of the Adventist Development and Relief Agency, a humanitarian nonprofit organizing aid for Ukraine.

“From the U.S., we are also supporting the Ukraine Humanitarian Effort, which is a GoFundMe collection for many verified nonprofits in support of Ukraine,” Bruellman said. “We have made a significant contribution and we are challenging our employees to do the same.”

Back at Stricker, the firm shared that it has clients in Ukraine, Belarus and Russia. It employs both Ukrainian and Russian sales professionals to service such accounts in that part of Europe. Gil said the war is proving harrowing for the supplier’s Ukrainian and Russian associates.

“All of them are very disturbed with the recent developments in Ukraine,” he said. “Some still have family – parents, brothers – in locations where fighting is actually happening in this precise moment. There are strong feelings of anxiety and fear since no one has absolute control of the situation.”

In recent years, Lewiston, ME-based Top 40 promo distributor Geiger (asi/202900) has substantially expanded its presence in the European market, in large part due to a strategic acquisition strategy. As such, CEO Jo-an Lantz, a Power 50 member, has been in close talks with her European connections since Russia attacked.

“In conversations I had in the past week with business owners and European colleagues, I heard worry and fear,” Lantz shared. “Part of the fear is the risk of continued escalation. For those who recall the echoes of World War II, it is a memory of the horrors that were. We are all watching this very carefully.”

Business Perspective

The general consensus among industry executives is that the war has not yet slowed promo products sales in Europe, outside the countries directly involved. Of course, the conflict is less than a week old and the situation is rapidly evolving, making business impacts difficult to predict, according to some leaders like David Long.

“If a peaceful solution is not found in the coming days and weeks, there will almost certainly be an impact on international business somehow, but at this stage it is hard to say how this may affect the promo market here in the United Kingdom,” said Long, CEO/executive chairman of Sourcing City, a trade service organization that provides a suite of solutions to the U.K. promo market. “Like many things,” Long continued, “it may not be a direct effect, but more likely the knock-on effect, that creates business issues for companies.”

Lantz has an idea of what some of those issues might be for promo.

“There will be a ripple effect in inflation, transportation and supply chain,” she said. “The cost of fuel will continue to increase (given Russia’s leading role as a major exporter of commodities like natural gas). Unscrupulous raw-material firms will see this as another opportunity to increase prices of product and materials that go into production, which in turn will increase our suppliers’ and decorators’ costs, which finally will increase everyone’s costs. Essentially this conflict will fuel more of the price increases everyone is seeing.”

“If a peaceful solution is not found in the coming days and weeks, there will almost certainly be an impact on international business.”David Long, Sourcing City

Showdown Displays is already feeling some inflationary pain due to fluctuations in currency exchange rates.

“The war has had an impact on the Czech Koruna and this makes it more expensive for us to buy materials,” CEO Bruellman explained. “The price of fuel has already been impacted as well. Ultimately, I believe the war will bring inflationary pressure across the board, both in Europe and in North America.”   

Oster said that what little exposure PFConcept has had to date relates to supply chain. The firm is adapting to the challenges, though.

“Our team is effectively rerouting overland container shipments around the war zone,” he told ASI Media. “We do not expect the current crisis to impact our business.”

Stricker is generally optimistic, too. While Gil expects a “complete zeroing of economic activity” regarding promo initiatives in its Ukrainian, Russian and Belarussian markets, he noted that this is only a small portion of overall sales. 

“On the rest of Europe, we have not noticed any kind of slowing down,” Gil said. “It’s obviously early to assess the situation with full data, but the economic rebound from the COVID-caused depression is too strong to be blocked by the current situation in Ukraine.”

Others are more leery.

BDA (asi/137616), a Top 40 distributor headquartered in Woodinville, WA that has operations/sales in Europe and elsewhere globally, reported that business impacts have been minimal to date but there are concerns about what lies ahead.

“We had two orders/deliveries cancelled as a result of the conflict, and a few shifted to other countries by European Union clients,” said BDA CEO/co-Founder Jay Deutsch, a Power 50 member.  “However, we are worried that the longer the war continues, there will be more impact that will take place not just on Russian and Ukrainian business, but also across the region.  Pricing, especially on freight, will increase.” 

Bruellman said that the uncertainty and geopolitical instability the war is causing is “not a good thing for recovering markets,” which the European promo marketplace most certainly is in the wake of the pandemic. “It’s hard to draw an exact line from the impact of the war to promotional spending, but the impact will definitely be felt. I truly hope it is temporary and it is quick,” he added.

Despite the dire situation, there are bright spots, said Michael Freter, a Germany-based promo industry expert/consultant. “Larger suppliers have reported good figures and the exhibitions industry is restarting,“ noted Freter, formerly managing director of PSI, Europe’s largest trade show for the promo market, and ASI’s 2020 International Person of the Year. “Mobile World Congress in Barcelona this week is crowded with an international audience, for instance. It’s one of the promo revenue drivers.”

As Deutsch alluded to, a huge variable is how long the war lasts and whether or not Putin decides to invade other European countries. Gil doesn’t think incursions beyond Ukraine will occur, but said that if such invasion happens, “the negative impacts will be completely different and with a much larger magnitude.”

“Meeting with our Ukrainian staff one day after the invasion, there were lots of tears and looks of shock on people’s faces.” John Lynch, Lynka

Bruellman agreed. “If Putin decides to invade other neighboring countries, then we will all be worried about much more than the economic impact in the promo industry,” he said. “There’s also another factor that could be at play, and it could be huge: If the Russian and Chinese governments become more closely allied, you will see American companies accelerate a departure from their reliance on Chinese suppliers. We will be among them.” 

Back in Poland, Lynch is among those business and political leaders who believe that Putin won’t march past Ukraine.

“No one expects Putin to step an inch onto NATO territory,” he told ASI Media. “I think the market understands that Poland, the Baltic States and other European member states that were formerly part of the Eastern bloc are NATO members, and that really changes the risk calculus.”

Lynch continued: “There is a school of thought that this conflict will end fairly quickly (by end of March) for economic, military and geopolitical reasons. And if the conflict does end soon, there may even be a bounce of optimism in Europe – after a very rough last two years.”

Were that to occur, there could be a positive trickle-down effect for the promo business, especially if the COVID threat continues to recede.

Even so, business considerations remain secondary for promo leaders like Lynch with close ties to the conflict. The day Russia invaded Ukraine, his son Jake came into the family kitchen to make himself breakfast. As the teen prepared an omelet, Lynch watched him and was soon seared by a burning realization: If the family was living a few hours away in Lviv, Ukraine, instead of Krakow, Jake and his friends might be heading out to pick up assault rifles from the government and then going to fight the invaders.

“I could feel the tears forming in my eyes, so I turned around so Jake wouldn’t see,” Lynch said. “Now that’s personal.”