Opinion: Shop now for Christmas, really
There are just nine weeks until Christmas. Five weeks until Thanksgiving. Three weeks until Daylight Saving Time ends. And one week until Halloween. It’s time to get your Christmas tree and do your holiday shopping.
I live in a household of one, so each year I have to decide whether I’ll put up a Christmas tree. My decision often depends on which day of the week Christmas occurs. If it falls on a weekend, I’ll likely drag my old three-foot piece of green plastic out of the garage and set it up on a table. Otherwise, I probably won’t go to the trouble.
This year is different. Nearly two weeks ago, I ordered a nine-foot pre-lighted and flocked piece of artificial Yule lumber. Why? This year, Christmas falls on a Saturday, my old tree is worn out, and I concluded that, if I’m going to buy a new tree, I might as well go big. Retailers are cautioning that if we wait much longer, Christmas trees may not be available until 2022.
Retailers across the country are warning people to shop early. Several merchandise gurus also advise shopping in person to make sure that you get the product. The problem is that the supply chain for nearly all goods is congested. Toys that are now on shelves were received two to three months after their expected arrival date because of the logjam in the Suez Canal when the Ever Green, a 220,000-ton container ship that is longer than four football fields ran aground in March.
Hundreds of ships were prevented from using the canal, including five other Gold-class ships like the Ever Green and dozens of other container ships and tankers. When the canal was finally cleared and ships could pass through and arrive at their destinations, docks were overwhelmed.
The mess caused by the blockage of the Suez Canal hadn’t been cleared when there was an outbreak of coronavirus caused by the delta variant in Guangdong Province, China, one of the world’s busiest export areas. Flights were canceled, communities were shut down, and trade was suspended along the coastline. Guangdong is home to the ports of Shenzhen and Guangzhou, the third and fifth largest in the world. They account for about one-fourth of all exports from China.
A fragile system
The crisis in Guangdong exemplifies how fragile the modern supply chain is. Pawan Joshi, executive vice president of Texas supply-chain-software provider, E2open, stated, “There is no room left anymore for error or unexpected events.” Expediters at every stage of the transportation process rely on predictable operation at each previous step. If one link in the chain falters, the entire system can collapse.
There is a domino effect involved. Goods pile up in factories because there is a shortage of containers. Containers ready for shipping aren’t moved because Covid-19 has caused too many warehouse workers to stay away from work. When containers are moved to factory loading docks, there are not enough trucks to move them to coastal ports because of a lack of drivers. And, toward the end of September, there were more than 50 container ships anchored in the Outer Pearl River Delta, waiting to dock in one of Guangdong’s ports.
One example of the effect of a backlog of shipping containers can be seen in Vantian, a port city about 40 miles north of Hong Kong. During the snag in the supply chain, the port city was unable to handle 357,000 20-foot container loads since late May. That is more than the total freight that was affected by the six-day closure of the Suez Canal in March. Waiting time for a ship to dock at Vantian can be as long as 16 days. Some ships are diverted to smaller ports like Guangxi, Yunnan, and Hubei, which are swamped by the unexpected increase in volume.
All of the above have a significant impact on the United States. Grocers are having problems meeting the demands for food, even pet food. Richard Galanti, Chief Financial Officer for Costco, said that wholesalers are putting a cap on purchases of toilet paper, paper towels, and water because of the uptick in the delta variant of coronavirus.
Matthew Friend, Chief Financial Officer for Nike informed NBC News that the company is moving apparel production out of Vietnam, where nearly half of the factories have been crippled by Covid-19, and relocating in countries like Indonesia. But, according to the Associated Press, although the island nation has reopened to vaccinated visitors who test negative and come from designated countries, it is still experiencing a significant number of new cases of Covid-19 after the Delta-variant surge in July.
About 90 percent of all goods are shipped across oceans, according to CBS News. Moreover, 85 percent of all toys sold in the United States come from China, and toy delivery is running four to six weeks behind schedule. That problem is due not only to the internal supply chain in China but also to domestic snarls in the system here.
At the beginning of last week, 70 container ships were waiting to get into Los Angeles and Long Beach ports. Those two facilities handle 40 percent of the nation’s imported goods. Buying patterns of Americans shifted from services to goods during the pandemic, and overall traffic is up by 50 percent. The director of the Port of Los Angeles told the press, “The American consumer’s buying strength is so strong and epic that we can’t absorb all this cargo into the domestic supply chain.”
In the U.S., the domino effect has impacted every link in the supply chain: shortages of warehouse workers, truck drivers, dock workers, and so on. And, even Christmas trees are affected. Citing wildfires, heat waves, and challenges to the supply chain, the American Christmas Tree Association is urging consumers to act now. It’s advice: Buy your Christmas tree early.
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Jim Glynn is Professor Emeritus of Sociology. He may be contacted at email@example.com.