Supply chain backup predicted to affect availability and pricing for the holidays

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Posted at 12:05 PM, Oct 14, 2021
and last updated 2021-10-14 12:05:44-04

TAMPA, Fla. — If you haven't started your holiday shopping this year, experts say you're already late. As the supply chain faces disruptions across the globe, holiday shopping is predicted to get very pricey, if you can even find items in stores.

“In over 25 years, I have never seen a clogged up supply chain of the kind that we are experiencing. It is in every mode of transportation, or ocean freight, trucking, parcel delivery,” said ShipMatrix President Satish Jindel.

Shipping and consumer experts say this is nothing like the toilet paper shortage; this is a major backup from manufacturers to the shelves.

Everybody talked about bulk buying toilet paper, but really as consumers, we were bulk buying everything because of the uncertainty, which then led to factories closing because of the pandemic, which led to ports closing, which led to supply chain pricing going through the roof,” explained Brett Rose, CEO of United National Consumer Suppliers.

In fact, container shipping is up 500%. A 40-foot long container from Asia to California used to cost $2,500 dollars, now it’s $12,000 dollars.

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Ships at the port in Los Angeles are waiting about a month to get in. As of October 13, the Marine Exchange reported 138 total ships in port between Los Angeles and Long Beach: 78 at anchor or drift areas and 60 at berths.

Walmart, they're being affected because they get huge amounts of products from Asia, Home Depot is another one, and they are going to the extent of chartering ships to get the products here,” Jindel explained. “And then you have companies like Nike because of its complex supply chain where they have raw material being shipped around different parts of the world, and then being assembled in other parts of the world are experiencing 80 days delay in getting this product to the store.”

This Christmas, the consumer is going to feel the cost. If these stores can even get the products, they’re still going to have a hard time putting on sales and promotions.

Don't wait for bigger discounts and bigger promotions in December... they will not be offering them,” Jindel advised, “Buy what you want in October, November.”

This is especially true in states like Florida.

The further from California, the further your expense to get it here because not only are manufacturers, importers spending $20,000 plus to get it on the ship to California, you know, you're now spending $15,000 if you can find it to get a truck from California to say Publix distribution centers,” Rose said.

Their advice: don’t panic buy, but plan. Shop early and be flexible in the brand.

The two stores that I could think of, which will be better position to have stocking at the store are Route 21 for teenage girls, they buy most of the stuff from wholesalers who already have them in the U.S.… And the other one is PVH, which owns the brand, Tommy Hilfiger and Calvin Klein,” Jindel suggested.

If you want a treadmill, does it have to be the specific treadmill you wanted? And if you find that treadmill, then you want to buy it for someone for the holidays, you need to buy it when you see it,” Rose added.

Even buying American-made products may be difficult because a lot of the products to make them come from overseas.

Jindel suggests two stores that may already have toys made here in the U.S. are Little Tykes and Fat Brain.

However, if you really want the best deals, this is the year for gift cards.

Particularly of stores like TJ Maxx and Overstock… big retailers who are unable to sell them when they get them in the right season, they sell it in large lots to those discounters, and they will have them in January... You’ll find the products and at a discounted price,” Jindel concluded.

Wednesday, President Joe Biden requested the California ports to operate 24/7 to help get product into the U.S. for the holidays.

He also asked companies like Walmart, FedEx and UPS to run 24 hours.

Jindel said Walmart is not a carrier that can move freight, and that FedEx and UPS already operate 24 hours, so he doesn’t think this will help much.

Biden said FedEx and UPS committed to doing more work at night.

However, many say a better solution would be greater incentives to get more truck drivers on the roads.

Overall, this isn’t something that can be fixed in a few months.

You have retailers now like Costco and Walmart that are buying out entire ships, so they're planning ahead because this isn't a problem that's going to fix itself in the next two, three, four months, this is a 12 to 18-month challenge we have with regards to supplying the actual product and the cost of maintaining the supply to make sure it's low enough,” Rose said.

The good news is that Black Friday experts predict the famous shopping day will still host deals, maybe not as big as before, but will likely start earlier and last longer than just one day.