ATLANTA (CNN) – On your next trip to Costco, don’t be surprised if you can’t find your favorite cheese.
Costco is having trouble stocking imported cheeses due to shortages of containers worldwide and bottlenecks at major West Coast ports such as Los Angeles, Long Beach, Oakland and Seattle. The combination has led to delays for suppliers dispatching their goods, retailers like Costco receiving higher products and costs along the supply chain.
“International freight has continued to be a problem with container shortages and port delays. This has caused delays in certain categories,” said Costco chief financial officer Richard Galanti, in a phone call with analysts last week.
The problem is not just limited to cheese, but also seafood, olive oil, furniture, sporting goods and lawn and garden equipment, said Galanti.
He expects “pressures to ease in the coming months, but it is affecting everyone”.
Supply chain pressures
Supply chain pressures have been a constant for retailers during the pandemic. But a chorus of chains, including Crocs, Urban Outfitters, Foot Locker and Dollar Tree, in recent weeks have described container shortages and delays at West Coast ports as the latest challenges in securing merchandise for consumers.
“Importing products from Asia, taking them through Long Beach and other ports and sending them to customers is really a challenge at the moment,” said Crocs CEO Andrew Rees on February 23 by telephone with analysts. “I think it will soften over time, but it will take a while.”
“We are experiencing some delays in receiving imported goods as a result of equipment shortages worldwide and problems with port congestion,” said Dollar Tree CFO Kevin Wampler last week.
And Anthropologie’s home products have also delayed their arrival in the United States due to a lack of containers in Asia, Urban Outfitters COO Francis Conforti said in a call with analysts.
“We are starting to see a very, very slight improvement, and we hope that the improvement will continue at a moderate pace.”
Pandemic demand
Demand for food, furniture, appliances and household products increased with the pandemic, as consumers spend more time at home. It didn’t.
US maritime imports increased by 20% in January compared to last year, according to the latest available data from Panjiva, a global trade data research firm. Imports of discretionary consumer goods, such as home appliances, were the biggest driver of growth, according to Panjiva.
Increased demand and supply chain disruption are also driving up costs: the total cost of shipping to the United States by sea reached $ 6.36 billion in January, compared with $ 2.46 billion a year earlier .
“The supply chain has been maximized,” said Jon Gold, vice president of supply chain and customs policy for the National Retail Federation, a trade group for the retail sector. Gold said that ports in the United States “were unable to cope with the incoming volume” because of an increase in demand, as well as hundreds of workers who fell ill with Covid-19.
“Containers have been at the port for longer than usual” and “the availability of empty containers has been a challenge, both here and abroad,” he said.
The pressures led more companies to resort to air cargo to ship goods. Until now, airfreight has been “always a last resort because it was eight to ten times more expensive than sea freight,” he said.
Gold said companies are trying to avoid passing on the higher costs they are facing to consumers, but some retailers may be forced to make up for the increase by raising prices on the shelves.
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