Worldwide alert and warning for shipping delays
Global supply chain issues mean higher prices and longer waits
If you bought a new couch, car, or washing machine in the past year and a half, you've probably heard a familiar phrase from the store manager.
"It is on back order."
They'll usually follow this with the promise that your order will arrive in a month or two. That was six months ago.
Why is it so hard to get the products you want?
The world is experiencing a logistics nightmare. It starts with the basics of manufacturing and extends to getting the product to a local warehouse and your front door.
The worldwide shortages and logistics problems we are experiencing begin with raw material production/extraction and component manufacturing delays — and the labor needed for both.
Then, the shipping link in the supply chain is broken when the products are ready to go. International ports in import countries are experiencing unprecedented congestion. Container ships idle offshore, waiting for a spot to unload.
There aren't even enough ships or shipping containers in the export cities to carry those high-demand consumer goods across oceans.
Where are all the shipping containers?
They are sitting on a ship anchored at sea. Others were filled and are waiting their turn to board.
The demand for space on container ships has led to some retailers contracting dedicated vessels. This logistics snafu is affecting nearly all international trade — including some promotional products.
According to Business Insider, all of this has caused shipping costs to rise tenfold for products coming out of Asia.
How did we get here?
So how did a worldwide pandemic lead to a logistics and transportation log jam?
Many economists and logistics experts say the problems that got us here started before the first covid shutdowns. According to Forbes.com, trade routes were already fluctuating as China and the US got into a tariff battle.
Then, the pandemic hit, and shutdowns began. Employers sent workers home, inventories sat unused, and raw material production slowed or stopped.
The trend turned around when the US and other consumer countries responded to the Covid-19 shutdowns with stimulus payments for their citizens. People started shopping again online and in stores.
In the US, purchases came from families who upgraded their appliances, renovated the basement for a home office space, or moved to new states and new homes. High demand for imported goods led to the current bottlenecks.
Finding enough labor is still a challenge for many companies as well.
According to the Advertising Special Institute, the promotional products industry faces the same issue.
As conferences and trade shows return and corporations send gifts to employees working from home, demand continues to grow. According to ASI, the promotional products industry was up 27.3% year-over-year in the second quarter of 2021.
This demand is not just for products made in Asia. Products made in the USA include components coming from overseas. One example is the ink needed for imprinting. According to ASI, while embroidery supplies have not been affected, screen and digital printing inks are.
When will shipping capacities increase?
As it stands, it is difficult to say when global shipping will return to normal. Recurring lockdowns in China have caused continuous disruptions to shipping plans, and congestion at key ports like Los Angeles and Long Beach means there isn't space for all these ships to dock and unload.
There's also the ongoing conflict in Ukraine, which is impacting shipping to Europe. Many freighters have to take longer, alternative routes in order to avoid waters that could be hot-spots.
What do customers need to know?
Prices are rising and are likely to continue to do so. Retailers fold shipping costs into the price tag for many items, as evidenced by rising inflation.
A good strategy is to be more proactive this year. Start shopping earlier and order in advance, long before you need the product in hand.
If you are looking into 2023 for new events and conferences, you should order with extra lead time built-in. It's scary to buy for a Spring 2023 conference so early. But an "evergreen" printed product with your company name and logo works for future events just as well.
Contact Logotech and your Account Manager now for your winter and spring promotions. Our staff will help you find what you want. With good planning, your order will arrive when you need it.