Multiple ports were hit, and peak season product inventory was tight

The epidemic has driven the rapid development of e-commerce, giving more sellers new hope and increasing sales. However, logistics issues have recently tripped up many sellers, with port congestion continuing and freight rates hitting new records.

Congestion at U.S. ports drives up prices for all kinds of goods

According to foreign media reports, due to a series of factors such as the epidemic, consumer demand, extreme weather, container shortages and labor shortages, a large number of ships are waiting to dock and unload at the ports of Los Angeles and Long Beach, California. With the peak season approaching, the inability of goods to arrive on time has caused considerable trouble for sellers.

Keith Jelinek, general manager of global retail business at consulting firm Berkeley Research Group , said that at the beginning of the epidemic last year, some ships had to be sealed up in order to save money. However, this year there is a shortage of containers and ships at the docks, which means that sea freight prices have soared. The price of a container has risen from US$2,700-2,900 last year to US$10,000-15,000.

"I hope the nightmare during last year's peak season will not happen again this year." A seller said that although it is only September, it is a crucial shipping season for sellers selling toys, electronics, sporting goods and other products. Unfortunately, the Christmas products sent by the seller more than a month ago have not arrived yet.

The backlog of cargo ships waiting to enter the ports of Los Angeles and Long Beach has pushed up commodity prices. 70 cargo ships loaded with furniture, electronics, toys and other goods have been delayed. " Shipping volume is 50% higher than before the pandemic ," said Gene Seroka, director of the Port of Los Angeles . "The purchasing power of American consumers is so strong, which means that this year consumers will not be as easy as usual to buy the products they want. "

Goods transportation is slow, sellers: this year's peak season is difficult

A recent survey shows that although the popularity of the holiday shopping season has been higher than Black Friday in recent years, 50 % of consumers will still complete their shopping before November 29. Affected by last year's shipping delays and inventory shortages, many American consumers will shop in advance this year. As of mid-August, 5% of foreign consumers have completed their shopping, and 12% said they will complete their shopping before Halloween.

In June, the National Retail Federation raised its forecast for retail sales in 2021, predicting that retail sales will increase by 10.5% to 13.5% to more than $4.44 trillion in 2021. The U.S. Labor Department said in August that the consumer price index rose 0.5% from June to July, the smallest increase since February.

“Some sellers are choosing to send goods by air, and some sellers are choosing to rent entire container ships to ship goods, which frankly, we have never seen before,” said Bob Biesterfeld, CEO of CH Robinson, one of the world’s largest logistics companies. “ We expect to see more empty shelves during the holiday shopping season this year , which may be something people are not used to. ”

American consumers' enthusiasm for consumption has not stopped since last year. Industry insiders said that all signs indicate that this year's holiday shopping season in the United States will be very hot, and it is very likely that some sellers will have no goods to sell. Some products originally planned to be sold during the holiday shopping season may not arrive until 2022.

A toy retailer in the United States said: "We have entered the real peak season, but there are problems with ships, ports, trucks and railways. Freight transportation has stagnated. Freight companies, warehouses and retailers are complaining about a shortage of workers, which we have never seen in the toy industry before. Due to the lack of trucks and drivers to transport goods from ports, some store shelves are likely to be empty during the holiday shopping season."

Industry insiders said that although many toy sellers do not have sufficient inventory, this has not affected foreign consumers' enthusiasm for purchasing the products. Therefore, if sellers want to ensure normal sales from February to April next year, they should start shipping now.

According to data from market research firm NPD , many American families bought a large number of dolls, board games and building blocks last year , with purchases increasing by 16% compared to the previous year. Therefore, many toy manufacturers have made early preparations to cope with unexpected supply chain challenges, but this is accompanied by the problem of soaring shipping costs. Some toy retailers said that due to the impact of shipping prices, the prices of toy products are likely to rise in the third quarter of this year.

In order to ensure sales during the peak season, a retailer spent $60,000 to order products from a competitor, but due to insufficient supply, he could only receive $20,000 worth of products. Another seller said that orders placed a long time ago are still not guaranteed to be sold in October or November . It seems that this year's peak season is too difficult!

Asian ports hit as holiday product inventories tighten

However, for sellers, the most important thing at the moment is the upcoming Halloween and Christmas.

In the United States, many families have already started purchasing Halloween and Christmas related products. Some Halloween outdoor decorations, Halloween costumes and candies are hot-selling. For example, inflatable pumpkins, Halloween giant spider webs, outdoor bat suits and other products are selling very well on the Amazon platform. Some sellers selling such products said that products priced below $50 are more popular with consumers.

In addition, many consumers who have already started preparing Christmas gifts and holiday decorations have found that the prices of Christmas-related products this year are surprisingly high. It is understood that many American retailers have raised the prices of Christmas trees, with an increase of about 20%-25%. Balsam Hill CEO Mac Harman said: " We have never raised prices so much, but the money we make is much less than in previous years. Holiday decorations, colorful lights, autumn wreaths and other products will soon be sold out, and the inventory is very tight. All this is caused by transportation delays . "

At the end of July, the Toy Association wrote to the U.S. Congress, saying that about 85% of toys sold in the United States are made overseas, but due to a shortage of containers, many products are stranded overseas.

On the other hand, Asian ports have also been hit. In recent days, Ningbo Port has been hit by terminal closures and bad weather, and port congestion has continued to worsen. In order to get rid of the bottleneck, some import ports have cancelled the priority loading of empty containers, which may cause problems in the coming months, as cargo from Asia is cancelled due to container shortages.

Industry insiders said that the freight market is currently in the busiest period of the year, and this situation may continue until Black Friday and Christmas, so it will take a long time to completely clear the congestion.

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