Shipping Delays Slow Availability of Hot Retail Items

Consumers may find themselves looking a little harder for the latest fashion or popular video games this fall season.

Products ranging from grain and steel and trickling down into everyday consumer wants are expected to be delayed thanks to a shaken shipping industry still affected by our recovering economy. The shipping bottleneck continues to largely affect retailers, distributors and manufacturers. Additionally, transportation costs have gone up as much as 150% and that number is only expected to rise going into the busy buying season.

According to industry experts the problem started at the beginning of the year.  In response to low sales, air cargo, trucking and shipping companies had to slash prices and cut capacity. This major reduction is expected to cause a lack of capacity to meet buyer demands. Ocean shipments have been hit the hardest. In response to this slump, Asia-based factories that build these large shipping containers (designed to transport these products) have also cut back on production.  Additionally, Chinese factories have scaled back production of hot items such as apparel and electronics. While many of the ships have returned to a regular schedule, they continue to run at sluggish speeds to keep fuel costs low.

Home-improvement retailer, Lowe’s reported delays of up to three weeks for top seasonal items such as grills and air conditioners. Currently, the retail giant is working on reserving containers to ensure that heaters and holiday decorations are stocked and available to it’s customers. Trendy apparel stores such as Urban Outfitters also felt the shipping squeeze and were forced to markdown many of their products this past spring.

This article was included in the August 2010 Edition of the IntegraCore Newsletter.