Supply chain snarls leave holiday stock orders in limbo

Toad Hall Toys might have an overabundance of stuffed animals and plastic dinosaurs this Christmas. Or, the goods may not come.

Owner Kari England began placing orders for the holidays last January — up to seven months earlier than normal for some products. She’d anticipated pandemic-induced supply chain backlogs and rising prices.

"Some (orders) we may not see at all this year," she said.

She bought items from her regular suppliers, and then similar versions from different sources, in hopes something would arrive on time.

"I may end up, in some cases, with a huge overload of an area, but it’ll just take me through to next year," England said.

By last Friday, about 85 per cent of her stock was in. England credited it to relationships with suppliers and being able to find comparable products while the regulars pend.

Global supply chain bottlenecks have forced local retailers to take what they can get as shopping’s busiest season approaches. Factories closing due to COVID-19 cases, a lack of containers to ship products, port and warehouse backlogs, and truck driver shortages have caused a slowed system filled with uncertainties and rising prices.

Increased demand for goods also plays a large role.

"You’re really lucky if you get half of what you ordered," said Kris Kurtz, the owner of Humboldt’s Legacy on Lilac Street.

The shop is filled with fair trade-goods from abroad.

"You have to grab what you can when you can, so the chance of having over–ordered, because you have to just order whatever is possibly available, it’s a pretty big stress." – Kris Kurtz, the owner of Humboldt’s Legacy

On Friday, Kurtz received candles from South Africa she’d ordered in April of 2020. The same morning, she learned only $720 worth of her $2,500 toy shipment was coming.

"Who knows when it’s going to arrive," she said.

Like England, she’s been over-ordering goods to fill shelves.

"You have to grab what you can when you can, so the chance of having over-ordered, because you have to just order whatever is possibly available, it’s a pretty big stress," she said.

The skyrocketing costs don’t help, Kurtz said. Shipping and raw material prices have been going up.

The cost to ship a container across the ocean has at least doubled, according to Paul Larson, a supply chain management professor at the University of Manitoba.

"There are some signs that (costs) have reached or are reaching a peak and will come down, rather than plateau here or go even higher," Larson said. "The supply/demand balance, once that gets more aligned, things can only get better on the cost side."

Higher demand and compromised supply naturally lead to rising prices, he said.

The global backlogs could remain for a while, depending on demand and capacity compromises, Larson said. He expects such spells to become more common.

"Some day, the pandemic will end, but there will be other disruptions — political disruptions, environmental disruptions," Larson said.

Small retailers must face higher operational costs while catering to clients who desire low prices, he said.

Brian Scharfstein, the president of Canadian Footwear, said he’s watched customers panic buy amidst recent reports of supply chain issues.

People are asking to buy three to four pairs of a shoe in one trip.

"We’ll do what we can to provide you with a pair or with two pair, but it’s a bit of a challenge," he said.

Canadian Footwear isn’t running out of stock any time soon, though certain sizes are getting close, Scharfstein said. Even so, it’s difficult to keep up with big box stores who have more sway in the logistics industry, he said.

"As independent retailers in Canada, it’s a different game," Scharfstein said. "It’s a matter of… ‘Are you stable enough, and can you ride this storm?’"

There’s no way to measure how many containers enter CentrePort Canada, Manitoba’s 20,000-acre inland port, because rail lines don’t publicly disclose their numbers, according to Diane Gray, the port’s president and CEO.

However, trucking companies have been buying up land for years, she said.

"You’re definitely seeing growth in the marketplace," she said.

A number of challenges have slowed the industry, including a shortage of semi-trailers and trucks due to a lack of computer chips, she said.

People will have options for presents this holiday season, according to Jim Cordingley, the co-owner of Kite and Kaboodle. However, shoppers looking for specific items should start extra early — goods may sell out fast, he said.

gabrielle.piche@winnipegfreepress.com