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Global Freight Problems Lead to Consumer Woes Affecting Both Public and Private Buyers.

Global Freight Problems Lead to Consumer Woes Affecting Both Public and Private Buyers.

Year by year comparison increase

Who is Affected:

With 80% of all goods being transported by sea, disruptions in the supply chain have created major price increases, product shortages, and service interruptions across the board. Virtually every retailer, supplier or distributor has been affected.

What is Affected:

Raw materials for manufacturing, manufactured goods, apparel, sugar, coffee and other food products have all seen limited or sporadic availability and soaring price increases.

What Are The Factors:

  1. Increased demand for products – From frenzy buying due to Covid 19 fears to government infused monies, more products have been in demand than ever before for a sustained period.
  2. Container Shortages – With the unforeseen demand for more products the global inventory of empty containers has been depleted. Manufacturing additional new containers isn’t an overnight fix due to construction lead times of 4-6 weeks per unit in many cases. A 40 foot steel container shipped from a port in China to a U.S. port pre-covid ran an importer roughly $3,500. In today’s global pandemic market, or the wake there of, that same container can cost a company upwards of $20,000 with the highest bidders getting the nod to fill the containers with their goods ahead of those jockeying for container space at the going market rate. We are seeing freight increases of 500% to 1000% in some cases.
  3. Over-Burdened Ports – As the demand for goods, containers and ships increase and the ports are being pushed past operation capacity. There is a significant labor shortage at ports along with a shortage of truck drivers that is causing significant backlog ports that is exacerbating the container shortage.
  4. Cargo Ship Shortage – Virtually every sea worthy ship has full bookings from 24-36 months. The building of new vessels usually is a 36 month process. You can’t just throw money at this one and you can’t speed up time.

Company and Consumer Choices:

  1. The Companies have to decide if the consumer will tolerate the increases in product prices and if the “juice is worth the squeeze” in selling particular products.
  2. The Companies must decide whether to pass on the increases to the consumer now or absorb them now (if they can support such a loss in revenue) and pass the increase on later. This is “robbing Peter to pay Paul” however it is an option to some mega companies, but “this chicken too will come home to roost.”
  3. Many Companies are being forced to limit offerings or shut down certain product lines or categories to accommodate either the products most in demand or those products with the best margins to be able to afford to do business and serve the customer, kind of. An example is when I went to buy a new refrigerator from a national big box home improvement store recently and was told there was a 60 day lead time which ended up being delayed by the manufacturer even longer to 75 days. The explanation was that the demand right now was for stainless front refrigerators and that all major brand manufacturers could not keep up with the demand for those, much less accommodate me in a timely manner since I wanted a white refrigerator.

Take Away:

Whether you are a consumer at your local retailer, a business owner, or an administrator of a public institution I would encourage you to continue to expect back order situations, out of stock notices, and sharp prices increases on everything from sugar to tee shirts and from coffee to refrigerators. Undoubtably this will affect your budget at home and at the office. One would be wise to not plan upcoming budgets on the last years Consumer Price Indexes or historical dollars spent per line item.

Outlook:

Based on my research of the projections on the global freight phenomenon by some of the leading industry experts I have found that many feel that their will be a “righting of the ship” (no pun intended) in early 2022 (After the Chinese New Year shipping season.) The big “IF” is that being possible if we are not shut down again Covid 19 mandates and “IF” the looming inflation fears do not come to complete fruition – but, I fear that ship has sailed! (pun intended)

Fake and Imposter Nitrile Gloves – Know where your supplies come from

Fake and Imposter Nitrile Gloves – Know where your supplies come from

Police raided a rented house containing more than 100,000 fake medical gloves and arrested the tenant in Wang Thonglang district.

Pol Lt Gen Permpoon Chidchob, assistant national police chief, led officials to search the 800-square-metre house no. 193/2 on Soi Lat Phrao 126 late Wednesday afternoon and found the fake nitrile rubber gloves inside.

The compound contains a three-storey European-styled house and two one-storey buildings. Police found over 100,000 blue-dyed rubber gloves in sacks, along with dye containers and washing machines.

Hard Time Products enjoys decades of experience in global sourcing for the very largest retail chains in the United States with a distinction on all categories of gloves to include the world’s largest distributor of retail work gloves. From product inception, manufacturing specifications, quality control, to fulfillment and delivery, we know the glove industry. Our CEO and VP of Sourcing have walked the factories around the world and our factories are required to be SER (Social/Environmental/Regulatory) compliant through SMETA (Sedex Members Ethical Trade Audit) and SA8000 Audits. Our factories must meet PSI (pre-shipment inspections) prior to leaving the factory.

Hard Time Products Internal Quality Control procedures prevent fake nitrile gloves from delivering to customers on April 1, 2021.

Not only were these gloves a different material than nitrile, but they certainly we’re not examination grade nitrile gloves. The Imposter gloves did not meet mil (thickness) specifications, color specifications, nor product gram weight specifications.

Glove certificates are just ink and paper. You can count on HTP to sort through the labyrinth that is the disposable glove market. We get it!

Do you know where your gloves come from?

Jeffrey S. Chandler, VP

What a blessing, conference season is back and “IN PERSON!”

What a blessing, conference season is back and “IN PERSON!”

The Common Theme:

From the various association events that we have participated in thus far in 2021 there has been a common theme. This theme was evident both from comments made by the associations’ leadership and observed in the conference climate among vendors and attendees – Fellowship!

Fel-low-ship: noun Friendly association, especially with people who share one’s own interest.

The benefits of training together, establishing and growing/maintaining a network of like minded folks are exponential. It has been said that “it isn’t always what you know, it’s who you know.” I say that it isn’t just who you know, but who you know and what they know. It may come across as completely cliche, but “team work truly does make the dream work.”

“Alone we can do so little; Together we can do so much.” -Helen Keller .

“As iron sharpen iron, so one person sharpens the other.” -Proverbs 27:17

It has been good to catch up, share ideas, and collaborate with old friends and nice to form new friendships. Business, whether in the private market or in the public sector, has proven to be a challenge to all of us. It has been encouraging to share experiences and celebrate the successes of these challenging times en rapport. I am very grateful for the opportunity to associate with colleagues and customers again at these conferences and I am certain that many others in attendance felt exactly the same way. What a blessing that I am not taking for granted!

Can’t wait to see you on the Road!

JC

Jail Populations Begin to Increase as Jury Trials Resume as Covid Concerns Wane

Jail Populations Begin to Increase as Jury Trials Resume as Covid Concerns Wane

Detention and Correctional facilities experienced sudden and sharp decreases in their average daily populations, entirely by design. This was due to covid fears and a complete halt on jury trials in many judicial circuits. Population decreases reached 50% reductions in some areas at the peak of Covid 19.

As court proceedings resume and local policies transition to “closer to normal operations” in Law Enforcement and Detention arenas jail populations are trending upward based on my conversations and experiences with facility administrators and detention facilities.

The detention wholesale market finds itself subject to the same supply chain frustrations as retail markets nationwide. Product shortages, extensive delivery lead times, increased raw material and freight prices are affecting facilities operations and climates.

Increased populations, supply chain lags, increased product pricing to include fuel and freight prices will all impact operational budgets. Additionally, Administrators struggle to recruit, hire and retain quality detention and corrections employees. These hurdles will certainly prove challenging for some time.

Please be sure to say thank you to those who work behind the walls and those who manage these facilities. The average person rarely thinks about the challenges of the day to day operation of detention and correctional facilities, much less about the additional strains that the global pandemic has brought.