• Advertise
  • Contact Us
  • About Us
  • Supplier Directory
  • SCB YouTube
  • Login
  • Subscribe
  • Logout
  • My Profile
  • LOGISTICS
    • Air Cargo
    • All Logistics
    • Express/Small Shipments
    • Facility Location Planning
    • Freight Forwarding/Customs Brokerage
    • Global Gateways
    • Global Logistics
    • Last Mile Delivery
    • Logistics Outsourcing
    • LTL/Truckload Services
    • Ocean Transportation
    • Rail & Intermodal
    • Reverse Logistics
    • Service Parts Management
    • Transportation & Distribution
  • TECHNOLOGY
    • All Technology
    • Artificial Intelligence
    • Cloud & On-Demand Systems
    • Data Management (Big Data/IoT/Blockchain)
    • ERP & Enterprise Systems
    • Forecasting & Demand Planning
    • Global Trade Management
    • Inventory Planning/ Optimization
    • Product Lifecycle Management
    • Sales & Operations Planning
    • SC Finance & Revenue Management
    • SC Planning & Optimization
    • Sourcing/Procurement/SRM
    • Supply Chain Visibility
    • Transportation Management
  • GENERAL SCM
    • Business Strategy Alignment
    • Education & Professional Development
    • Global Supply Chain Management
    • Global Trade & Economics
    • HR & Labor Management
    • Quality & Metrics
    • Regulation & Compliance
    • SC Security & Risk Mgmt
    • Supply Chains in Crisis
    • Sustainability & Corporate Social Responsibility
  • WAREHOUSING
    • All Warehouse Services
    • Conveyors & Sortation
    • Lift Trucks & AGVs
    • Order Fulfillment
    • Packaging
    • RFID, Barcode, Mobility & Voice
    • Robotics
    • Warehouse Management Systems
  • INDUSTRIES
    • Aerospace & Defense
    • Apparel
    • Automotive
    • Chemicals & Energy
    • Consumer Packaged Goods
    • E-Commerce/Omni-Channel
    • Food & Beverage
    • Healthcare
    • High-Tech/Electronics
    • Industrial Manufacturing
    • Pharmaceutical/Biotech
    • Retail
  • THINK TANK
  • WEBINARS
    • On-Demand Webinars
    • Upcoming Webinars
    • Webinar Library
  • PODCASTS
  • VIDEOS
  • WHITEPAPERS
Home » U.S. Retailers See Millions in Sales Delays Amid Shipping Logjam

U.S. Retailers See Millions in Sales Delays Amid Shipping Logjam

Shipping Logjam
Freight trucks idle at the Port of Los Angeles. Photo: Bloomberg.
February 28, 2021
Bloomberg

Overwhelmed U.S. ports, elevated freight costs and accidents that sent goods plunging to the bottom of the ocean are causing headaches for U.S. retailers already reeling from the pandemic.

From appliance makers to shoe brands and fitness equipment manufacturers, corporations of all sizes are reporting logistics struggles, especially on trans-Pacific trade routes. Although they haven’t yet translated into widespread sticker shock for consumers, the ongoing shipping issues threaten to disrupt inventories if they persist much longer.

“I don’t think we’re meeting everybody’s expectations today — and frankly, we’re unlikely to. I doubt if anybody else is either importing products from Asia,” Crocs Inc. Chief Executive Officer Andrew Rees said on an earnings call last week. “Getting it through Long Beach and other ports, getting shipped to customers is really challenging right now. And that’s not an issue with production capacity; that’s just logistics.”

The supply strains, compounded by shortages of shipping containers, are starting to hit companies’ operations. Nautilus Inc., which makes fitness machines like Bowflex, said on a call last week that logistic issues delayed the launch of some of its new connected treadmills. Shoe-maker Wolverine World Wide Inc. said $20 million in sales would shift from the first to the second quarter because of the backlogs. Steven Madden Ltd. said supply chain disruptions cut the footwear company’s first-quarter sales expectation by $30 million.

Retailers expect the problems to spill into the next quarter, though some say they think the worst is behind them.

Nautilus CFO Aina Konold said the company no longer needs to send purchase orders two or three quarters into the future. “We have gone back to issuing them closer to normal lead times of several weeks,” she said.

Lowe’s Cos. CEO Marvin Ellison said in an interview appliances in particular are still having some challenges, but “we’ll have corrected it” over the next couple of months.

Lost Overboard

Outside of the usual shipping headaches, Tapestry Inc. brand Kate Spade had the misfortune of being involved in two separate cargo ship incidents where containers full of goods went overboard in rough seas. CEO Joanne Crevoiserat said earlier this month that the losses will impact the brand’s spring deliveries. Mike George, CEO of QVC and HSN owner Qurate Retail Inc., said he’s lost at least one big batch of vacuum cleaners to the ocean floor.

The logjams come as demand from American companies and consumers has remained strong enough to propel U.S. merchandise imports to a record-high in January, even as exports remained sluggish. That divergence led the gap between the two — the goods trade deficit — to increase again and stay close to a record-wide set in November.

All those inbound products are clogging the nation’s biggest ports, from Savannah, Georgia, on the East Coast to Los Angeles — the biggest gateway for trade with Asia. The number of container ships waiting to enter the neighboring ports of L.A. and Long Beach stood at 27 late Thursday, with an average wait of more than a week. Parked in San Francisco Bay were about a dozen container vessels waiting to berth at the Port of Oakland, according to satellite tracking.

Air and Sea

Economists at the nation’s central bank have taken note of the difficulties, and at least one doesn’t predict an end to them anytime soon. According to a paper published Friday by Julianne Dunn, an economic analyst at the Federal Reserve Bank of Cleveland, “it is likely that supply chain disruptions will continue to evolve for the foreseeable future.”

In the meantime, some companies are paying premiums to send goods by air, substituting products on shelves and trying to renegotiate arrangements with shippers. Steven Madden is shipping some goods by air but is “judicious” about the move, CEO Edward Rosenfeld said, because the cost of air freight is also up over 100% compared with a year ago.

There’s been little relief recently on ocean freight, either. The Drewry Hong Kong-Los Angeles container-rate benchmark of spot rates has held steady over the past six weeks, averaging just over $5,900 per 40-foot container — more than quadruple the level of a year ago.

“The planning ability is absolutely key,” Under Armour Inc. CEO Patrik Frisk said in an interview earlier this month. “Anything you try to do on the fly, so to speak, is going to cost you dearly as it relates to transportation.”

    RELATED CONTENT

    RELATED VIDEOS

    Air Cargo Logistics Freight Forwarding/Customs Brokerage Global Gateways Global Logistics Ocean Transportation Transportation & Distribution Global Supply Chain Management Global Trade & Economics Apparel Consumer Packaged Goods E-Commerce/Omni-Channel Retail
    Bloomberg

    Europe Gas Prices Soars 20% as Market Shows Signs of Tightening

    More from this author

    Subscribe to our Daily Newsletter!

    Timely, incisive articles delivered directly to your inbox.

    Popular Stories

    • A RED AND WHITE FRITOS DELIVERY TRUCK IS PARKED IN THE LOADING ZONE OF A PARKING LOT NEXT TO AN ORANGE TRAFFIC CONE.

      Climate Change Threatens a World Without Doritos

      Global Supply Chain Management
    • A CITY SCENE AT NIGHT, WITH MANY LINES OF LIGHT RISING FROM THE GROUND

      Welcome to the World of ‘Ambient’ IoT

      Data Management (Big Data/IoT/Blockchain)
    • Managing-Supply-Chains-in-the-Face-of-Climate-Disaster.jpg

      Watch: Managing Supply Chains in the Face of Climate Disaster

      Regulation & Compliance
    • A WOMAN STANDS WITH A TABLET COMPUTER IN A WAREHOUSE, SURROUNDED BY SYMBOLS FOR SHIPPING METHODS

      Podcast | Getting the Most Value From Your Supply Chain Planning System

      Technology
    • A LARGE WHITE WALMART TRACTOR TRAILER IS DRIVING ON A FREEWAY BEHIND A PICK-UP TRUCK ONE LANE OVER.

      Walmart Unveils New Sustainability and Waste Reduction Measures

      Supply Chain Planning & Optimization

    Digital Edition

    Scb may 2023 lg

    2023 Supply Chain ESG Guide

    VIEW THE LATEST ISSUE

    Case Studies

    • JLL Finds Perfect Warehouse Location, Leading to $15M Grant for Startup

    • Robots Speed Fulfillment to Help Apparel Company Scale for Growth

    • New Revenue for Cloud-Based TMS that Embeds Orderful’s Modern EDI Platform

    • Convenience Store Client Maximizes Profit and Improves Customer Service

    • A Digitally Native Footwear Brand Finds Rapid Fulfillment

    Visit Our Sponsors

    Antuit Zebra Anvyl Brother
    Cleo Data Capture E2open
    Eva Air Enveyo GAINSystems
    Generix Geodis GEP
    GreyOrange Here Holman Logistics
    Infor Inmar Kinaxis
    Locus Robotics Logility LogistiVIEW
    Lucas Systems MCA Connect MPO
    Old Dominion OneRail Overhaul
    PartnerLinQ (Visionet) Port of Virginia Ryder E-commerce by Whiplash
    Saddle Creek Logistics SAP Shyft
    Sourcemap Tecsys TGW Systems
    Verusen Workshop
    • More From SCB
      • Featured Content
      • Video Library
      • Think Tank Blog
      • SupplyChainBrain Podcast
      • Whitepapers
      • On-Demand Webinars
      • Upcoming Webinars
    • Digital Offerings
      • Digital Issue
      • Subscribe
      • Manage Your Subscription
      • Newsletters
    • Resources
      • Events Calendar
      • SCB's Great Supply Chain Partners
      • Supplier Directory
      • Case Study Showcase
      • Supply Chain Innovation Awards
      • 100 Great Partners Form
    • SCB Corporate
      • Advertise on SCB.COM
      • About Us
      • Privacy Policy
      • Contact Us
      • Data Sharing Opt-Out

    All content copyright ©2023 Keller International Publishing Corp All rights reserved. No reproduction, transmission or display is permitted without the written permissions of Keller International Publishing Corp

    Design, CMS, Hosting & Web Development :: ePublishing