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By Hope Ngo/Sept. 8, 2021 1:17 pm EDT
When it comes to shopping for Christmas gifts, we don’t think we’re going out on a limb by saying there are two kinds of people: the kind that shop for presents with plenty of time to spare, and the kind that wait until the last minute to head to the mall and fight crowds to find presents, like the way salmon famously swim upstream in order to return to the place they were born.
And while personal shoppers and personal finance experts say there are always good reasons to mark your Christmas shopping list as “done” long before the holiday season begins, it is even more imperative to get things done early this year. Analysts note that retailers are struggling with issues that begin at the source with manufacturers and production, and which carry through to transport and logistics, all the way to what they call “last-mile delivery.” As Rob Caucci, co-CEO of logistics company Filogic says, “when we hear ‘supply chain disruptions,’ it’s a loaded statement, because there’s so many areas in the supply chain that are experiencing disruptions. It’s not just the ocean freight and the containers, it’s not just the sourcing and production and it’s not just the delivery. It’s really this kind of confluence of factors” (via Modern Shipper).
The pandemic has driven up the cost of air and sea cargo
Our Christmas wish lists are being held hostage, and not just by the Delta variant, which has spread across much of Asia, where many of the world’s factories are — and where lockdown measures needed to counter high infection rates forced many factories around the region to stop working, at least temporarily (via Reuters). They’re also being affected by problems in shipping and logistics, which compromises a manufacturer’s ability to get goods from where they are made to where they are meant to be sold.
Business Insider reports that the problem with global logistics could be seen in 2020. It began with air transport, when a drop in human air traffic meant fewer planes were taking to the skies, and fewer planes were available to carry cargo. As a result, air freight charges went up by as much as 400% in some instances, because shippers were willing to pay a massive premium in order to have their goods delivered from one place to another. Sea cargo has been a problem too, because containers, which are meant to hold goods, are not where they are meant to be today. The shortages have since led to ports being clogged by items waiting to go out, and it’s driven up the cost of ocean freight rates, in some cases, by as much as 14 times.
Concerns over the global supply chain crisis for Christmas
Christmas may be months away, but even now, consumers already admit that they are struggling to acquire things they want. This does not bode well for the holiday season, which is when many shoppers go after the same items, be it consumer electronics, toys, or clothing.
In a survey released in mid-August 2021, Gallup reported 60% of Americans have admitted that product shortages kept them from getting their hands on something they wanted, while more than half, or 57%, say they’ve seen delays in getting a product they ordered. Seven out of every 10 Americans have encountered at least one of the two problems mentioned, while nearly half of those surveyed, or 46%, have experienced both.
American consumers are not alone. In late August 2021, Australian retail executive Anthony Heraghty sounded the alarm, saying the shipping and logistics crunch has made it difficult to predict what Christmas will look like. “… Even if you are buying it eight to twelve months out, the chances of it arriving on time is zero. If it’s not in the shed or on the shelf today, for Christmas this year I think the chances of it being [in stock] come that peak time is incredibly remote ” (via Sydney Morning Herald).
Given all this, it might be time to check the list, manage expectations, and get the shopping done before the holiday season is really underway.
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