Price Increase & Product Shortage Resource Guide
Posted on 06/14/2021 at 06:02PM in Spring 2021: Industry Newsletter
As we continue to see an unprecedented number of manufacturer price increases, product shortages and delays in shipments, we want to take a moment to share some valuable information that will help you understand why this is happening and how you can plan ahead to minimize the impact this could have on your business and your day to day work.
Our purchasing team is working hard to purchase as much inventory as we can from our existing product lines. The team is also actively working to purchase from substitute lines to ensure we have what you need to help you get your jobs done. For more information or to chat about product availability, please reach out to your local branch. We’re here to help!
The below resource guide that helps explain many of the reasons for the manufacturer price increases, product shortages and delays in shipments. We encourage you to review this valuable information and feel free to pass this information along to your customers.
Why Are There Product Shortages & Price Increases?
· Due to the uncertainty of Covid and other related issues, manufacturers under forecasted sales thinking sales would drop and they did not.
· Due to uncertainty in the market, there was a lot of panic buying. Due to the increase in demand, this caused manufacturers to get backlogged with production.
· Manufacturers prioritized production of A & B items, while in some cases, C and D products were not placed in production causing further delays on certain products.
· Due to fulfillment issues, some manufacturers canceled backorders without notification causing further delays.
· Due to the increased cost of fuel and raw materials, this is having a direct impact on the cost of products.
What Is Happening With Shipments Coming From Overseas?
· Products coming in on boats are experiencing many delays due to ships waiting in the LA Harbors to be unloaded.
· Once the containers are unloaded at the docks, there are issues with getting the products loaded onto trucks due to a shortage of truck drivers available to then deliver the products.
· Chinese New Year in February caused 16-day plant closures which slowed down production and shipments coming to the USA.
· Overseas companies are experiencing freight container shortages.
· Suez Canal was blocked for 1 week which caused shipments to be delayed.
Weather & Employment Related Issues
· Due to the storm in Texas, manufacturers prioritized products to ship to areas hit by the 2021 storms
· Due to layoffs/shutdowns during Covid, many employees when given the opportunity to return to work are choosing to stay on unemployment due to unemployment benefits sometimes paying more than an employee would make working.
Click here to download a PDF with this information.
To keep up to date on all manufacturer increases, visit www.hirsch.com/priceupdates.