Industry Is Slowing Down: Decisions Facing SMEs This Autumn

September presents manufacturers with a question that has direct implications for the final quarter: how to remain competitive amid more uneven business activity and limited investment resources.

Data published by the National Statistical Institute over the past week point to a decline in industrial production and substantial differences between sectors. Foreign trade also requires careful analysis by product, market and period. At the same time, the reporting obligations under the Cyber Resilience Act have started to apply, while businesses have until 18 September to submit proposals on a forthcoming funding procedure for cooperation between enterprises and research organisations.

For SMEs, these developments are a reason to review orders, production losses, customer dependence and technology priorities together. The next decisions should be based on the enterprise's own data and a clear assessment of the results that each change could achieve.

A National Decline and Different Trends Across Sectors

In July 2026, industrial production in Bulgaria decreased by 3.0% compared with June and by 6.8% compared with July 2025. However, the differences between individual activities are substantial:

The data are preliminary. Monthly changes are seasonally adjusted, while annual changes are calendar-adjusted. Some activity names in the table have been shortened. NSI: industrial production in July 2026, Tables 1 and 2.

These are national indicators. They provide a reference point for enterprises in the Ruse region, but the position of an individual company should be assessed through its orders, markets and costs. The decline in production alone does not establish its causes or the extent of any change in profits.

For management purposes, it is useful to compare results over several consecutive months alongside confirmed future orders. A temporary pause by a major customer, a change in the product mix and a sustained weakening of demand require different responses. An initial discussion with key customers can help determine whether the production schedule needs to be adjusted, market development efforts intensified or the product offering reviewed.

Orders, Costs and Payments Need to Be Reviewed Together

At lower utilisation levels, fixed costs may be spread over a smaller volume of output. At the same time, a new order may require additional setups, special materials, more inspections or a longer payment period. An increase in turnover alone may therefore provide an incomplete picture of financial performance.

A practical approach is a brief weekly management review covering five groups of indicators:

• Orders and capacity utilisation. How much of the available capacity is covered by confirmed orders, where spare machine hours are available and which operations constrain fulfilment.
• Performance by order and customer. How the quotation's cost estimate compares with actual costs, including setup, rework, packaging and transport.
• Scrap and unplanned downtime. Which causes recur, what resources they consume and who is responsible for addressing them.
• Inventories and work in progress. How much money is tied up in materials and products that cannot yet be invoiced.
• Payments and overdue receivables. Which receivables are delayed and how this affects the ability to purchase materials and fulfil subsequent orders.

The value of this review depends on the decisions that follow. A recurring defect requires an examination of a specific process. Systematic deviations from the cost estimate provide grounds for changes to pricing or work organisation, while accumulating overdue receivables call for a review of payment terms.

For example, two groups of orders generating the same turnover may make different contributions to financial performance. One involves longer production runs with few setups, while the other requires frequent tool changes, additional inspections and separate deliveries. If these costs are excluded from the analysis, the enterprise may allocate capacity to less profitable activities. Comparing the hours and materials actually used with the quotation provides a basis for negotiating batch sizes, lead times and prices.

A limited set of reliable data, collected consistently, is sufficient to begin with. Management can expand the scope once the initial indicators start to support actual decisions.

Exports Require Analysis by Product and Market

For January–July 2026, Bulgaria's total exports increased by 8,5%, and imports increase by 13,7% compared to the same period of the previous year. The negative foreign trade balance reached 7.395 billion euros.

In July alone, total exports increased by 5.5%, while exports to third countries decreased by 14.2%. Over the full January–July period, exports to these countries still recorded growth of 3.3%. This distinction between the monthly result and the cumulative trend is significant. NSI: foreign trade in January–July 2026.

In trade with the EU, for which the detailed data cover the first half of the year, exports grew by 10.3%. For goods classified mainly by material, the increase was 44.9%. At the same time, exports of machinery, equipment and vehicles decreased by 0.6%, while the decline in miscellaneous manufactured articles reached 23.4%. NSI: trade with the EU in January–June 2026, Table 4.

Trade indicators measure values at current prices. Changes in prices and the product mix can influence them, so they should not automatically be equated with changes in the physical volumes of industrial production.

The practical implication is that each enterprise should examine its sales through the combination of product, country, customer and margin. This helps establish whether growth comes from larger quantities, higher prices, new customers or a change in the product range. When selecting a new market, demand for the specific product needs to be assessed alongside delivery and payment terms.

Customer dependence also deserves closer examination. Sales across several countries may still be linked to a single corporate group or a single end-market sector. It is therefore useful to identify which customers would be affected simultaneously by a change in demand. Developing new contacts can begin with a targeted presentation of specific manufacturing capabilities, supported by technical documentation, lead times and examples of completed products.

For enterprises dependent on river transport, logistics remains part of this assessment. On 14 September, the Executive Agency for Exploration and Maintenance of the Danube River reported a water level of −122 cm at Ruse. EAEMDR: water levels. Specific restrictions on loading and passage should be checked with carriers. Contingency routes should be assessed jointly in terms of cost, transit time, available capacity and the working capital required.

Digitalisation Starts with a Measurable Production Loss

When investment resources are limited, a technology project needs a clearly defined business problem. Useful starting points include recurring downtime, slow preparation of quotations, a lack of defect traceability or a gap between planned and actual production costs.

Depending on the problem, the first step could be:

• recording downtime and its causes by machine to guide maintenance;
• linking defect data to the order, material and production operation;
• compiling a consolidated report on quoted and recorded costs for completed orders;
• tracking enquiries, quotations and the reasons for lost deals.

Before selecting a solution, the baseline value of the indicator, the expected improvement, the data required and the person responsible for the process need to be defined. The assessment should also include the costs of implementation, integration, training and ongoing maintenance.

A suitable approach is to start with a limited pilot in one operation or product group. For example, systematically recording defects can help identify a recurring problem with a particular setup. The business benefit will come from addressing the cause and subsequently measuring scrap.

The involvement of the people who work with the equipment and enter the data every day is essential in this process. Operators need to understand how to record a downtime event, while the manager should use the information collected when assigning tasks. Clear definitions, brief training and regular feedback help prevent omissions and different interpretations of the same events. When the pilot is expanded, these working rules can also be applied in other production areas.

The working hours freed up should also be assessed realistically: what proportion can be used for additional orders, shorter lead times or reductions in actual costs. This provides a more reliable basis for the next investment.

Technology Collaboration Has a Specific Deadline for Feedback

To September 18, 2026, 11:59 p.m., proposals and objections to the draft procedure are accepted in the UMIS BG16RFPR002-1.012 "Cooperation Programs for Innovation and Transfer of Knowledge and Technology"„. The indicated indicative announcement date is September 30.

The procedure aims to support long-term cooperation between industry, SMEs, research organisations and higher education institutions. As of the date of this publication, it is at the public consultation stage; 18 September is the deadline for comments on the draft conditions. EUMIS: draft procedure and deadlines.

For enterprises in Ruse, this is a suitable time to define shared technological challenges that could be discussed with the University of Ruse and other research partners. Potential topics include quality control, new materials and the traceability of production processes.

A brief description of the problem is useful for the initial discussion: where it arises, how it is measured, what solutions have already been tried and what expertise is missing. It is advisable to clarify in advance what data can be shared and under what conditions. This will help potential partners distinguish shared needs from the specific tasks of each enterprise and discuss a realistic outcome from the collaboration.

Before making commitments, the eligibility of participants and activities, their own financial contribution, opportunities for pilot implementation and rights to the results need to be clarified. The Chamber's involvement in organising an initial dialogue should be considered separately from its eligibility as a formal project partner, which requires verification against the conditions.

CRA Reporting Is Now an Operational Task

Since 11 September 2026, manufacturers of products with digital elements within the scope of the Cyber Resilience Act have been required to report actively exploited vulnerabilities and severe incidents affecting the security of those products.

Notification must be made without undue delay. From the point at which the manufacturer becomes aware of the relevant event, the early warning must be submitted within 24 hours at the latest, and the subsequent notification within 72 hours. For an actively exploited vulnerability, the final report is due within 14 days after a corrective measure becomes available. For a severe incident, the deadline is within one month after submission of the 72-hour notification. European Commission: CRA reporting obligations..

The first necessary check is whether the company offers a product within the scope of the Regulation and acts as a manufacturer. This is particularly relevant to software and connected equipment offered under its own name or trademark. Simply using digital systems in production does not make an enterprise the manufacturer of those systems under the CRA. The Regulation's main requirements start to apply on 11 December 2027, but reporting already requires readiness. European Commission: CRA scope and application.

Notifications are submitted through the working ENISA's Single Reporting Platform. The Agency has published guidance on registration, submission and updating of notifications, a user manual and training materials. ENISA: access to the platform and guides.

For affected enterprises, immediate preparation includes appointing a responsible person and a deputy, ensuring the necessary registrations and access rights, establishing an internal escalation procedure and securing access to the product's technical data. Where external developers and suppliers are involved, it is necessary to agree in advance who will provide the information and within what timeframe.

Internal arrangements also need to cover reports received outside normal working hours. Employees who communicate with customers or support products should know whom to notify immediately. It is useful to keep the technical contacts, cover arrangements during absences and the method for documenting actions taken in one place.

A brief internal walkthrough of an example case, including the preparation of a sample notification, can show whether this sequence works.

What Should Be Ready by the End of September

To turn the analysis into action, we propose the following work schedule:

1. Immediately: check whether the CRA applies. Affected manufacturers should verify responsibilities, platform access and the notification process.
2. By 18 September: review the draft technology cooperation procedure. Interested enterprises should discuss a shared problem with potential research partners and assess the need to submit comments on the conditions.
3. By the end of September: carry out a joint review of orders and performance. Production, sales and finance teams should compare capacity utilisation, cost estimates, inventories and overdue receivables.
4. By the end of September: select one measurable improvement. Define the process, baseline indicator, budget, responsible person and criterion for evaluating the pilot.
5. Before finalising fourth-quarter planning: update market and logistics scenarios. Review dependencies on key customers, delivery terms and the financial reserve required.

This framework enables management to connect short-term execution with preparation for the months ahead. Enterprises with clear data on their own losses and dependencies can make better-informed decisions about directing limited resources towards productivity, market development and technology upgrades.

The Ruse Chamber of Commerce and Industry publishes analyses of this kind to help enterprises in the region assess the business environment, new requirements and opportunities for cooperation. Feedback from businesses on orders, capacity and technological difficulties can provide a basis for more specific discussions and partnership initiatives.

If you would like to share observations from your enterprise or discuss opportunities for technology collaboration, please contact me at sminchev@rcci.bg or 0895 890 123.

Note: This publication was prepared with the assistance of generative artificial intelligence, used to structure the content and verify the sources. The information is current as of 14 September 2026 and does not constitute individual legal or financial advice.