All summer, I tried to buy things, and mostly I failed. I signed up for two separate wait lists for out-of-stock black spandex bike shorts, which I needed for the Peloton I had bought, itself back-ordered for two months. I also added my email address to a wait list for curtain rods, remembering how the shifting fall sun broils the kitchen table that’s now my office. When word from Bed Bath & Beyond came weeks later to let me know they were back on sale, I was too slow on the draw—they sold out about as swiftly as hand sanitizer did in March. Over the weekend, I believed I had acquired replacements for my worn-out bed linens, but my email receipt contained a confession: The sheets would arrive, at best, around Halloween.
When I asked Steve Rowen, a managing partner at the retail-analytics firm Retail Systems Research, if these inventory problems were as widespread as my personal frustrations suggested, he had to stifle a laugh before answering me: “Absolutely.” Similar problems currently dog all kinds of retailers, and they have for months. At the beginning of the pandemic, when most people assumed that things would be back to normal in weeks or months, retailers and manufacturers “weren’t really in a hurry to shift gears and make a lot of expensive decisions,” Rowen said. “I don’t think anyone really had any indication as to how long this pandemic and its effects were going to be felt.” (...)
Since millions of Americans started spending a lot more time at home, many of them have been making very similar decisions about how to do so comfortably. According to Rowen, that has helped create supply issues in all sorts of categories: food, cleaning products, medication, exercise equipment, outdoor gear, furniture and home decor, renovation supplies, home electronics, office supplies, loungewear, and beyond. At the start of the year, no one could know that standing desks and kiddie pools would become hot commodities. But this far into the pandemic, shortages aren’t persisting only because of what’s suddenly trendy.
To understand why you still can’t find your preferred migraine medication or your usual brand of dog food, you have to start with where those products begin: manufacturing. Long before most Americans had a hint of the disaster to come, the inventory of many products began to thin behind the scenes. The United States imported more than half a trillion dollars’ worth of products from China in 2018, about 20 percent of the country’s total annual imports. When China went into lockdown in late January to stanch the spread of the coronavirus, the country’s enormous manufacturing sector screeched to a halt. That paralyzed the flow of all kinds of things into the United States—strollers, gym clothes, Nintendo Switch consoles, and crucial components for products assembled in other countries, such as textiles for clothing and parts for cellphones and computers. When those components disappeared, some assembly lines in countries such as Vietnam and South Korea went idle, compounding the crisis in the U.S.
Brands and retailers that relied on imports from China or elsewhere in Asia began considering suppliers in Latin America, Europe, or the U.S. to pick up the slack. But as those searches got under way, the coronavirus spread to more countries, shutting down many manufacturing facilities around the world, at least temporarily.
Then, having controlled the coronavirus, Chinese manufacturing rebounded. “As soon as China was up and running, and the United States’ manufacturing facilities weren’t, we started importing more goods from China than ever before,” Rowen said. But an elevated reliance on things produced half a world away comes with some risks. Goods make their way from Asia to the U.S. on massive cargo ships, and the shipping industry is barrelling toward a labor crisis: Hundreds of thousands of workers are currently stranded at sea because their home countries’ pandemic travel restrictions prevent them from coming ashore. Abandoning them on ships threatens to collapse global shipping by exhausting and abusing workers currently at sea while driving those waiting for work to other industries. Meanwhile, the rest of the world—which supplies the remaining 80 percent of imported goods sold in the U.S.—has yet to return to full manufacturing capacity.
No matter where a product is made, it has to be packaged before it can be shipped or stocked on a shelf, creating yet another obstacle. Plastic bottles and pouches, cardboard boxes, and aluminum cans all have to be manufactured too, and often with expensive machinery that can make only a very specific type of bag or bottle. It doesn’t matter how much hand sanitizer you make if you don’t have the right thing to put it in. The consumer supply of flour is still recovering, in part because mills spent months fighting over a finite supply of the small paper sacks it’s packaged in. There was always plenty of flour, but someone baking sourdough for the first time doesn’t want one of the giant bags that typically get sent to restaurants.
Once products are manufactured, packaged, and imported, they still have to be distributed to warehouses and stores, which has become its own bottleneck. The pandemic has made long-haul trucking more dangerous and difficult—in the spring, truckers lacked protective gear and sanitizing equipment, and many of the places where they’d normally get a night’s rest or a hot meal had closed due to lockdowns. Since then, demand for truckers’ services has surged along with demand for certain types of products, and some trucking companies have capitalized on it by switching on short notice to routes that pay better, adding even more chaos to the scramble to get sought-after products onto shelves. Even when items make it onto a truck, more slowdowns await: More trucks are arriving than warehouses and stores usually deal with, and they have only so many loading docks and so many hours in a day.
by Amanda Mull, The Atlantic | Read more:
When I asked Steve Rowen, a managing partner at the retail-analytics firm Retail Systems Research, if these inventory problems were as widespread as my personal frustrations suggested, he had to stifle a laugh before answering me: “Absolutely.” Similar problems currently dog all kinds of retailers, and they have for months. At the beginning of the pandemic, when most people assumed that things would be back to normal in weeks or months, retailers and manufacturers “weren’t really in a hurry to shift gears and make a lot of expensive decisions,” Rowen said. “I don’t think anyone really had any indication as to how long this pandemic and its effects were going to be felt.” (...)
Since millions of Americans started spending a lot more time at home, many of them have been making very similar decisions about how to do so comfortably. According to Rowen, that has helped create supply issues in all sorts of categories: food, cleaning products, medication, exercise equipment, outdoor gear, furniture and home decor, renovation supplies, home electronics, office supplies, loungewear, and beyond. At the start of the year, no one could know that standing desks and kiddie pools would become hot commodities. But this far into the pandemic, shortages aren’t persisting only because of what’s suddenly trendy.To understand why you still can’t find your preferred migraine medication or your usual brand of dog food, you have to start with where those products begin: manufacturing. Long before most Americans had a hint of the disaster to come, the inventory of many products began to thin behind the scenes. The United States imported more than half a trillion dollars’ worth of products from China in 2018, about 20 percent of the country’s total annual imports. When China went into lockdown in late January to stanch the spread of the coronavirus, the country’s enormous manufacturing sector screeched to a halt. That paralyzed the flow of all kinds of things into the United States—strollers, gym clothes, Nintendo Switch consoles, and crucial components for products assembled in other countries, such as textiles for clothing and parts for cellphones and computers. When those components disappeared, some assembly lines in countries such as Vietnam and South Korea went idle, compounding the crisis in the U.S.
Brands and retailers that relied on imports from China or elsewhere in Asia began considering suppliers in Latin America, Europe, or the U.S. to pick up the slack. But as those searches got under way, the coronavirus spread to more countries, shutting down many manufacturing facilities around the world, at least temporarily.
Then, having controlled the coronavirus, Chinese manufacturing rebounded. “As soon as China was up and running, and the United States’ manufacturing facilities weren’t, we started importing more goods from China than ever before,” Rowen said. But an elevated reliance on things produced half a world away comes with some risks. Goods make their way from Asia to the U.S. on massive cargo ships, and the shipping industry is barrelling toward a labor crisis: Hundreds of thousands of workers are currently stranded at sea because their home countries’ pandemic travel restrictions prevent them from coming ashore. Abandoning them on ships threatens to collapse global shipping by exhausting and abusing workers currently at sea while driving those waiting for work to other industries. Meanwhile, the rest of the world—which supplies the remaining 80 percent of imported goods sold in the U.S.—has yet to return to full manufacturing capacity.
No matter where a product is made, it has to be packaged before it can be shipped or stocked on a shelf, creating yet another obstacle. Plastic bottles and pouches, cardboard boxes, and aluminum cans all have to be manufactured too, and often with expensive machinery that can make only a very specific type of bag or bottle. It doesn’t matter how much hand sanitizer you make if you don’t have the right thing to put it in. The consumer supply of flour is still recovering, in part because mills spent months fighting over a finite supply of the small paper sacks it’s packaged in. There was always plenty of flour, but someone baking sourdough for the first time doesn’t want one of the giant bags that typically get sent to restaurants.
Once products are manufactured, packaged, and imported, they still have to be distributed to warehouses and stores, which has become its own bottleneck. The pandemic has made long-haul trucking more dangerous and difficult—in the spring, truckers lacked protective gear and sanitizing equipment, and many of the places where they’d normally get a night’s rest or a hot meal had closed due to lockdowns. Since then, demand for truckers’ services has surged along with demand for certain types of products, and some trucking companies have capitalized on it by switching on short notice to routes that pay better, adding even more chaos to the scramble to get sought-after products onto shelves. Even when items make it onto a truck, more slowdowns await: More trucks are arriving than warehouses and stores usually deal with, and they have only so many loading docks and so many hours in a day.
Image: Getty/The Atlantic
