Local businesses face shortages amid supply chain issues
Observing supply chain issues and shortages, Pete Marcus said he stocked up Lee's Toy and Hobby in Groton "pretty well, anticipating a good holiday." He does his best to stock the store with things he knows are popular but said "the chips fall where they will," and he's never seen supply issues like this before.
Some types of toys and collectibles are becoming harder to get or only have limited options, Marcus said, citing Legos, games, and Pokemon cards.
"If you're coming in specifically for certain items, you better shop now," he advises. He added, "When you get into specifics, that's when you're going to be in trouble."
Supply chain experts are also advising consumers to shop early for the holidays and to be flexible with what they want.
Scott Gladstone, whose group owns seven Wireless Zone locations, including in New London and Groton, said he is faced with the same chip shortages and transportation issues as every other industry, but that Verizon has done a good job of streamlining its distribution.
"They are planning ahead as best as they can," he said. "However, that being the case, we are actually telling our customers now, plan it as far ahead as you possibly can."
Even when there isn't a supply chain crisis, Wireless Zone runs out of phones in December because of increased demand.
Gladstone said the stores used to have a lot more inventory but now don't have even entry-level phones in stock, though it may only take two to four days to get a phone once ordered. He said stores are able to stockpile things like chargers, other accessories and repair parts, though.
Why are these issues happening?
Cuihong Li, professor of operations and information management at the University of Connecticut School of Business, pointed to three reasons for shortages: high demand, shortage in supply, and logistical bottlenecks.
The pandemic caused increased demand for certain types of goods, such as furniture and electronics, but because factories shut down, the supply can't keep up with demand. On top of that, a shortage of truck drivers, warehouse space, and containers have contributed to bottlenecks.
Li said usually when container ships arrive from Asia at a port on the West Coast, they would unload and then reload the containers back to Asia. But because it's now taking so long to unload, ships may not be able to wait long enough to reload, and they'll sail back to Asia with empty containers.
She said it's taking longer to unload because increased demand means more ships are coming, but there's a shortage of workers at the port.
"You need trucks to pull away the containers and to unload the goods at the warehouse," Li said. "Now, if you don't have enough workers at the warehouse, if you don't have enough truck drivers to pull away, then you cannot unload the containers from the ships as well, so everything is kind of interlocked."
She said it's good news that ports are now working 24/7, but we also need more trucks and more warehouse space.
On Oct. 13, after the Port of Long Beach began operating 24/7, President Joe Biden announced an agreement for the Port of Los Angeles to become a 24/7 operation, with Walmart, FedEx, Target, Samsung and The Home Depot committing to unloading during off-peak hours. Walmart, Target and other large retailers have also chartered their own container ships.
The Bureau of Labor Statistics reported that consumer prices are up 5.4% from a year ago, and that U.S. import prices were up 9.2% from last September to this September.
Kate Li, professor of information systems and operations management at Suffolk University's Sawyer Business School in Boston, noted that Chinese factories are also closing or experiencing temporary restrictions because of power shortages.
She also noted that a lot of toys, gaming systems, smartphones and other electronics are impacted by the microchip shortage. Therefore, she doesn't think there will be a significant discount on these kinds of items on Black Friday, and she's not even sure whether the most popular items will be in stock then.
While factory closures and labor shortages have impacted a wide variety of products, Li said making chips is a bigger problem because it requires skilled workers.
She said people will also want to pay attention to published holiday shipping deadlines. For example, when doing ground shipping, the recommended send-by date for delivery before Christmas is Dec. 15 for the U.S. Postal Service and for FedEx.
Li said in the time since she entered her PhD program in 2004, she's seen shortages here and there, but nothing to the extent of what we're seeing now. She doesn't see the situation getting worse but she also doesn't see it getting better for at least the first half of 2022, because "you need time to clear up the backlog."
'If you see it, buy it now'
At the Olde Mistick Village kitchen and specialty food store Kitch, owner Dan Price said the products that are difficult to get make no sense, so it's hard to plan. He couldn't get garlic presses for about two months, and finding pizza stones was hard for a while. Cutlery fluctuates.
Price said it used to take three days for an order to arrive and he would get about 95% of what he wanted, but now it takes two and a half weeks to get 35 or 40% of what he wants, and he has to reorder from someone else.
"We're seeing a lot of Christmas shoppers now, which is earlier than we (usually) do," Price said. "We tell people: 'If you see it, buy it now.'"
He said all of the cookware Kitch sells is American-made, and he'll buy things American-made even if they're more expensive, but most of the gadgets and knick-knacks are made in Asia.
At Kelley's Pace in Olde Mistick Village, owner Jeff Anderson said manufacturers started migrating from China to Vietnam a few years ago, but Vietnam went into lockdown in July and shut down production.
New product introductions have been delayed, and the life cycle of old products is ending so there's less available. Anderson places orders about seven months in advance and fills in along the way, but he's seeing that orders placed six months ago are being delayed.
But he "went on a buying spree," so his basement is full of product. Kelley's Pace carries shoes from nine manufacturers, and he said the more popular ones — Hoka, Asics, New Balance and Brooks — will run out sooner. Customers will be able to get a shoe that fits right but not necessarily in their preferred color.
As for clothing, electronics and recovery items, it's been up and down. Anderson said a lot of summer clothes never came, and the September order of safety vests with fiber optic lights hasn't arrived.
Johnson's Hardware in Groton isn't as big for holiday shopping as other stores, but fourth-generation owner Bill Johnson said getting power equipment has been a struggle. One issue is there aren't enough people working in manufacturing, he said, and while companies assemble products in America, parts come from elsewhere.
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