Christmas cheers from UK retailers will be rations this year as logistical challenges both domestically and in Asia narrow the product range and offer fewer discounts during the holiday season.
While supply issues in food distribution have grabbed the headlines in recent weeks, non-food retailers face similar setbacks in planning and storage during the busiest times of the year.
Gary Grant, Founder and Executive Chairman of Entertainer, which operates over 170 UK toy stores, said:
He cited product inflation, high transportation costs, container supply issues and factory capacity constraints as some of the issues he faced.
Summer problems at some major Chinese container ports and the blockage of the Suez Canal earlier this year have created bottlenecks. “The factories in China are clogged up, so we only make what we order,” Grant said.
A senior executive at a large retailer said his company “worked with suppliers to get the best out of themselves, even if they weren’t always what they ideally wanted. I’ll put it on.
“Ironically, the period immediately following 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] That much. Sure, it has a built-in safety margin, but for further confusion, it’s not too loose. “
Grant also said his business was around 10% behind normal in terms of the number of containers received.
Even air freight is far from smooth due to reduced passenger capacity, the recent introduction of additional Covid-related precautions at many Chinese airports, reduced productivity and rising 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 suffer from a shortage of semiconductor chips.
An executive at a large retailer said he had chartered charter flights to bring some products to the UK. “Obviously, you don’t have to do this too often. “
Ikea said this week that some of the furniture delivered to Europe had been converted to trains to ease transport 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 added problem that there are too few truck drivers to get around.
Dan Myers, managing director for UK and Ireland transport at XPO Logistics, warns of a ‘severe’ Christmas increase for retailers unless the government changes its mind not to re-approve drivers based in the EU. low.
So far, the minister has resisted proposals from many retail, hospitality and logistics sectors to add heavy truck drivers to the list of missing occupations. This will allow non-UK citizens to work here and alleviate the shortage of around 100,000 drivers.
“Retailers are already streamlining some of the reach and reducing the frequency of delivery,” Myers said. “Some people are tweaking what would have been their historic peak plan to smooth it out and lengthen it.
“This will make it a tough Christmas build. This 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 disruption”. Rush for shipping “.
Some retailers have said the range has shrunk and discounts may not be very aggressive. “Black Friday is quite similar to the year before, but it can restrict the choice of brands and individual products,” said an executive at a large retailer.
“We’re also looking at promotional activities and rethinking what can cause inventory supply issues. “
Even retailers, like DIY Group Kingfisher, who are less reliant on Christmas deals, are a bit worried, especially as delivery issues may persist until at least the Chinese New Year in early February. I am considering next year.
“We managed supply and demand during the peak summer season. Our priority is to prepare for next year and the next high season, ”said the group.
Christmas Toy Story: UK Retailers Prepare for Stock Shortage Source Link Christmas Toy Story: UK Retailers Prepare for Stock ShortageSource link