'These systems are very fragile': Global supply chain disruption has local impact in lead-up to busy shopping season
With one of the busiest shopping seasons of the year approaching, filling shelves and orders these days may come with extra challenges for many businesses due to ongoing issues with global supply chains.
The pandemic has disrupted the worldwide movement of all kinds of products, and it’s not clear when those problems could be resolved.
Granville Island Toy Company owner Joanna Mileos said there are definite issues with supply at the moment.
“Whether it be containers, or whether it be factory shutdowns during COVID and they just haven’t had enough time to produce decent quantities,” she said. “It’s definitely been having a trickle-down effect, not just in toys, in everything, and I think we’re already seeing price increases right across the board.”
She said the cost of shipping containers has also gone up, at a time when there’s a shortage, and some suppliers are working on managing expectations.
“We’re already seeing suppliers who are telling us we’re not accepting any orders for the rest of this year,” she said. “There (are) suppliers who are sending out their availability lists on a regular basis to say, hey, this is what we have in stock, and we may or may not get any more products.”
University of Victoria associate professor Adel Guitouni says at the same time as the shipping slowdown, consumer demand has also surged.
“People are buying more stuff online and so on, because that money that was usually used for travel or other kinds of expenses, we are doing renovation, we are doing other things,” he said. “These systems are very fragile right now, and what we see today is just the symptoms of the fragility of the system.”
He said the strain on global supply chains pre-dates COVID-19, as companies outsourced for cheaper production, and the pandemic has only exposed weaknesses in the system.
“As we have been developing these chains, we did not invest at all in resiliency,” he said. “They have been built mainly for the sunny days.”
He said this situation could provide an opportunity for local and domestic industries to compete, and for consumers to think more locally.
“When you have a strained kind of system, if you start pulling, either someone has to give or it’s going to break,” he said, and added current supply chains also create pollution that contribute to climate change. “This is an opportunity for us to rethink all of this.”
Mileos said growing support for local businesses has been one positive during the pandemic.
Her advice for holiday shoppers this season is not to wait too long.
“The earlier the better this year, for sure,” she said.