The Christmas cheers of British retailers will be rations this year as logistical challenges both domestically and in Asia narrow the product range and offer fewer discounts during the festive season.
While supply issues in food distribution have dominated headlines in recent weeks, non-food retailers are facing similar setbacks in planning and stockpiling during the busiest times of the year.
Gary Grant, founder and executive chair of entertainer, who runs more than 170 toy stores in the UK, said:
He cited product inflation, high transportation costs, container sourcing issues, and factory capacity constraints among the issues he faced.
Summer problems at some major Chinese container ports and the blockage of the Suez Canal at the beginning of the year led to bottlenecks. “The factories in China are clogged, so we only make what we order,” Grant said.
A senior manager at a major retailer said his company “worked with suppliers to get the best they got, even if they weren’t always what they wanted ideally. I’ll put it in. “
“Ironically, the period immediately after a pandemic has proven to be more difficult than a full-scale pandemic,” he said. “We are about eight weeks late [in terms of Christmas stock build] at this point. Of course, it has a built-in safety margin, but in the event of further confusion, it’s not too loose. “
Grant also said his company was about 10 percent behind normal in terms of the number of containers it received.
Even air cargo is far from smooth due to reduced passenger capacity, recent introductions of additional Covid-related precautions at many Chinese airports, reduced productivity and increased costs.
Toys, along with bicycles and large household items, are one of the most affected categories. Home appliances, where transportation accounts for a small percentage of the total cost, are less affected by freight issues, but are suffering from a shortage of semiconductor chips.
An executive at a major retailer said he chartered charter flights to move some products to the UK. “Obviously, you don’t have to do it too often.”
Ikea said this week that some of the furniture delivered to Europe has been converted to trains to ease transportation restrictions.
There is no overall shortage of shipping containers, but freight rates remain high and containers are often left in the wrong place. When they arrive in the UK, there is the additional problem that there are too few truck drivers to move.
Dan Myers, managing director of transportation in the UK and Ireland at XPO Logistics, warns of a “severe” Christmas increase for retailers unless the government changes its mindset not to reapprove EU-based drivers. bottom.
So far, the minister has resisted proposals from many of the retail, hospitality, and logistics industries to add heavy-duty truck drivers to the list of missing professions. This will allow non-British citizens to work here and alleviate the shortage of an estimated 100,000 drivers.
“Retailers are already rationalizing some of the scope and reducing delivery frequency,” Myers said. “Some people are changing what would have been their historic peak plan to smooth and lengthen it.
“It will make it a tough Christmas build. It will affect availability.”
Andrew Opy, Head of Food and Sustainability at the British Retail Consortium, said retailers “have taken all necessary steps to mitigate possible disruptions.” Rush for shipping “.
Some retailers have said that the range has narrowed and discounts may not be very aggressive. “Black Friday is pretty similar to the previous year, but it can narrow the choice of individual brands and products,” said a major retailer executive.
“We also look at promotional activities and rethink what can cause inventory supply problems.”
Even retailers, like the DIY group Kingfisher, who are less dependent on Christmas deals, are a little worried, especially given that shipping issues can persist until at least the Chinese New Year in early February. I am considering next year.
“We have managed supply and demand during the peak summer season. Our priority is to prepare for next year and the next peak season,” the group said.
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