As the all-important holiday season nears, retailers in both the brick-and-mortar and e-commerce segments are expecting a banner year in terms of sales; even for Halloween, the National Retail Federation is forecasting over $10 billion in sales, up nearly $2 billion from 2020. That would be an all-time high if the NRF's prediction proves prophetic.

But given the ongoing supply chain frustrations that have encapsulated 2021, retailers are buying from their suppliers in bulk now so shoppers have plenty to choose from when the season of giving ramps into high gear.

Lowe's Chief Financial Officer David Denton told investors that while supply has improved in certain areas, they want to be properly prepared given the bottlenecks that remain problematic.

"[Things] are actually getting better, not worse," Denton assured investors, as reported by Supply Chain Dive. At the same time, though, "it's hand-to-hand combat," Denton added, as retailers are competing with one another to ensure they have enough to sell.

83% increase in shipping time
They're also preparing in advance due to how long it's taking for supplies and purchases to reach their intended destinations, particularly those coming from overseas markets. In September, for example, products being shipped from China to the United States took an average of 73 days to arrive, according to estimates from the Port of Los Angeles. That's an increase of 83% compared to the same month in 2019.

That sellers are planning ahead undoubtedly comes as great news for manufacturers, who have expressed their concern over how long it's taking for items to arrive. During a virtual press conference with the Port of Los Angeles, executives for The Toy Association said it would behoove parents to buy for their kids now while shelves are fairly well stocked.

"Right now, toy manufacturers are doing everything in their power to ensure a good supply in stores for the holidays," said Ed Desmond, executive vice president of external affairs for The Toy Association. [B]ut we just don't know what's going to happen down the road as we get closer to Christmas."

Desmond added that a huge portion of the toys sold in the United States — 85% — originate from countries in Asia, such as China, Bangladesh and other major foreign suppliers. 

Problems at the ports have retailers stocking up now for the all-important holiday season.Problems at the ports have retailers stocking up now for the all-important holiday season.

COVID-19 remains a major crisis 
Part of what's contributing to the issue is COVID-19, as the pandemic continues to rage in certain parts of the world where vaccination rates are lower. For example, some warehouses have had to shut down their operations temporarily due to coronavirus infections impacting employees.

However, retailers' proactive stance has others confident that there will be enough product to purchase — and gifts to unwrap — come Dec. 25. Best Buy CEO Corie Barry said as much in an earnings call, noting the company moved "as much inventory as possible" earlier this year in preparation for the holiday buying blitz.

According to Deloitte, holiday sales are poised to jump between 7% and 9% this year compared to last, with e-commerce sales potentially growing 15%.

Share To:

The Strategic Sourceror

Post A Comment:

0 comments so far,add yours