Supply stores

‘Buy now for the holidays’ chorus intensifies amid supply chain bottlenecks


If you feel like some retailers are pushing holiday shopping before you’ve even considered a Halloween costume, that’s because they are.

Amazon monday announcement what he called “Black Friday-worthy” deals and a hub to help consumers plan holiday giveaways and events. It follows Target and Walmart by encouraging consumers to buy early when gift-worthy products are still available.

Worldwide supply chain bottlenecks and shipping delays This means that the closer the calendar gets to the December holidays, the less likely it is that some store shelves will be filled with what consumers want the most. Pundits don’t expect traffic jams to ease until early 2022, long after the giveaways have opened and the books closed during traditionally retail’s busiest time.

“Major retailers expect a strong holiday shopping season, but have warned of limited stocks, longer shipping times, labor shortages and fewer discounts,” said Morgan Stanley economists in a recent note to investors.

Still, consumers are expected to be spending a lot this year, even as prices for items ranging from toys to clothing are set to rise sharply, according to one. report from retail and technology consulting firm Coresight Research. The Dollar Tree chain of stores, for example recently announcement this further increases prices above $ 1.

Product scarcity can impact holiday shopping


“Since we’re already seeing gaps on the shelves, we expect to see visible evidence of product shortages this holiday season,” John Mercer, head of global research at Coresight, told CBS MoneyWatch.

Consumers will likely spend up to 10% more this year, some of them fueled by nearly $ 1.7 trillion in federal stimulus funds since the pandemic began last year, according to Coresight’s report. . And if buyers run into shortages, many will likely switch to other options like gift cards, although recipients may have to wait until New Years to redeem them, Mercer added.

Large retailers stocked up earlier than usual this year as the United States struggled to come out of the pandemic. Target, for example, had 26% more inventory at the end of June than in 2020, at the height of store closings. The retailer ordered earlier – and in larger quantities before the holidays – to ensure shelves were stocked and could be restocked, John Mulligan, COO of Target, Recount investors in August.

For its part, Amazon is “confident in our ability to serve customers this holiday season,” a spokesperson said. The distribution giant noted it is “on the right track” to hire 125,000 more people in the warehouse and logistics trades.

Small retailers brace for empty shelves

Smaller retailers are bracing for potentially more empty shelves later in the season. The goods arrive, but the delays are longer. Delivery people are slimmer, and salespeople are trying to figure out how much of the extra cost to absorb or pass on to retailers – who in turn must decide whether to charge consumers more.

Henry Bear Park, a store chain of eight Boston-area stores and an online store that sells specialty toys, games, books and puzzles, ordered items months earlier, owner Kas Sharma told CBS MoneyWatch.

Normally, Henry Bear’s would wait until August, September and October to stock up on holiday items. But this year, the small chain began placing orders in May after vendors and suppliers warned of supply chain safeguards and worker shortages. More than half of the shipments have yet to be delivered, says Sharma.

“We will by no means have as much as we would have liked to pack for the holidays,” said Sharma. “But we still hope that after ordering early and in large quantities, we will have enough to satisfy a decent holiday season.”

Sharma says he’s also grappling with the same dilemma that manufacturers, distributors and shippers have: raise prices or absorb higher costs this year. The price of chartering giant sea containers to cross the Pacific Ocean loaded with cargo, for example, has increased tenfold and even 20 times over the past year.

“If it’s a one-time thing, then you don’t want to raise the prices. But if it’s a new standard, we can’t absorb the price change that’s happening in the industry, ”Sharma said.

Another problem: new, higher shipping rates for the U.S. Postal Service and a slow delivery. Henry Bear’s offers free shipping starting at $ 50 and a flat rate for lower purchases. “But now we’re trying to figure out: are we increasing the free delivery threshold? So what should it be? And the flat rate delivery charges that we have, is that going up? Sharma said.

The shortage of books is already being felt

Booksellers are also struggling with shortages. The demand for books is strong, but the industry faces the same potential shortage issues. In August, book publishers and wholesalers urged retailers to stock up, the American Booksellers Association said in a Publish.

“Publishers of all sizes are reporting significant printing issues,” the blog read. This means that release dates and reprints may be delayed. Add to that warehouse labor shortages and delays are likely, depending on the post.

“Some publishers suggest that booksellers place a new order now with a future shipment date to keep inventory for their store. This will save booksellers space and money in the short term,” reads. we in the message.

Costs are also increasing in this industry. A recent editor Recount the New York Times that air mail costs $ 5 to $ 8 per pound. That compares to 35 cents to 50 cents in container ships on the ocean, the way most cargo travels around the world.

Freight chaos in major US ports


Clothes and shoes, double the shipping time

At Nike, long delivery times have worsened. Then, mandatory factory closures in Vietnam and Indonesia blocked shipments destined for the holiday shelves, CEO John Donahoe said. Recount investors on a recent call.

Before the pandemic, it took about 40 days to move a pair of Nike sneakers from Asia to North America. With container shortages, port and rail congestion, and labor shortages, shoes “now rest at 80 days – about twice normal,” he said.

Department stores like Macy’s and Nordstrom ordered and confirmed contingency plans with suppliers earlier in the year than during a normal holiday period.

“It has been difficult to plan the flow of inventory with great precision. We don’t expect these conditions to change anytime soon,” said CEO Erik Nordstrom. Recount investors on a recent call.

Even the Christmas tree …

Last month, the American Christmas Tree Association advised consumers to get their trees early, whether live or artificial. You can also expect to pay more.

The costs of living trees have roughly doubled since 2015, according to a report of the US Department of Agriculture, while prices for artificial trees have risen 20% to 30%, the Holiday Tree Group said.

Fires, drought and heat waves, exacerbated by climate change, have decimated the yields of some tree crops. Some Oregon farmers have lost as much as 90% of their harvest, the group said.

“We hope that everyone who wants a Christmas tree will find their perfect tree this year,” Jami Warner, ACTA Executive Director, said in a recent declaration. “If I can give consumers any advice right now, it’s to find and buy your Christmas tree in advance.”


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