With the holidays right around the corner, many people are already starting to think about ordering gifts. Retailers have been reassuring shoppers that they are flush with ample inventory. However, despite the reassurance, supply chain problems persist.
Angeli Gianchandan, who is a professor of marketing at the Pompea College of Business at the University of New Haven stated in an interview, “Supply chain issues are here to stay. Everything is fragile now, our supply chain is fragile, our crops are fragile … Labor is fragile. Everything is colliding now. It’s the perfect storm.”
Global unrest is fueling supply chain problems such as the war in Ukraine, China’s continued zero-COVID-19 tolerance and policies which continue to cause manufacturing shutdowns, and severe storms such as Hurricane Ian in Florida.
Hurricane Ian hit Florida as a Category 4 hurricane causing widespread devastation. The demand for certain items during the recovery efforts has escalated and is putting a huge strain on the supply chain.
Additional problems impacting the supply chain:
- The Mississippi River is sitting at record-low levels of water which has made it impossible for barges to traverse. Many have become stranded.
- Many forecast a rail worker strike will occur. In September, the strike was averted but it could still occur because the Brotherhood of Maintenance of Way Employees rejected an agreement that was pushed by President Biden.
- The trucking industry has a shortage of chassis which is the base of the semi-trailer. At this time, the Journal of Commerce believes that the shortage will persist into 2024 and the shortage is only going to become more extreme.
Holiday Savings
As the holiday season approaches, retailers will probably start offering sales on last year’s excess of products. Consumers will see dramatic savings. The inventory situation has become extreme which means that retailers are going to start clearing things out as quickly as possible for the holidays.
It’s shaping up to be an odd year where there will be ample supplies of some items and droughts of others.
Historically, the holiday shopping season kicked off on Black Friday, but now retailers have started offering huge savings in October and the first of November.
Despite the uptick in early purchases, most buyers are still shopping online and foregoing in-person shopping at malls and department stores.
