Are you already thinking about what you want for the holiday season? Already ordering presents for your friends and family? To some this might sound ludicrous, but buying holiday items earlier might be the only way that they come in time.
Global supply chain disruptions are threatening to tank this holiday season. Before the pandemic it was considered normal to have one port waiting to unload. Now much more than 60 container ships –holding billions of dollars of goods– are stuck outside of Los Angeles.
The Pandemic has significantly slowed down our ports and companies like Dollar Tree, target, home depot, and Costco are chartering their own ships to get around ports that are unloading at a snail’s pace. New fines have recently been set for companies who are holding up the supply chain.
As supply and congestion problems are arising, consumer demand is the highest it’s ever been.
Rhinebeck Reality interviewed Gideon Moor, Rhinebeck’s Government and economics teacher, about why there is so much demand this holiday season especially.
“The government created artificial demand by putting money in people’s pockets.” said Gideon Moor. The US government gave away a lot of stimulus because of their fear that demand would collapse and the economy would go under. The government did it’s job too well and created a demand that the supply chain can not keep up with.
The pandemic checks kept certain people afloat and gave other people who were not as much in need extra money for goods.
“American consumers have too much demand and now inflation is on the rise,” said Mr Moor. People spent their extra money on goods rather than services that were less available due to the pandemic.
The holiday season comes with immense demand for goods; if demand is not met with supply, there could be consumer disappointment. At least 20 to 25 percent of goods stuck on ships will not make it onto shelves for Black Friday.
Black Friday is the kickoff for the holiday season where retailers make one third of their profit according to Reuters.
The ships that are congested hold timely items like Christmas sweaters that won’t sell if they arrive late. Ordering from retailers that are finding creative solutions to the problem would be a good idea for your holiday items to come on time. Merchandise retailers like Walmart and Target are keeping up on inventory, so ordering from them or going into a store would be best for late holiday shopping.
Rhinebeck High School has had its own shipping hiccups. The agenda books that were supposed to be handed out at the beginning of the year were late because of the shipping delays caused by the ripple effects of the Covid pandemic.
Mr Moor is increasingly worried about inflation due to the supply and demand imbalance. “The current 12-month inflation rate is 5.4%,” According to Kiplinger’s economic forecast on inflation. The rate is expected to rise to 6.1% by the end of the year.
“This will be the highest rate of inflation since 1990. Expect inflation in 2022 to ease to 3% as shortages fade, but that will still be higher than the 2% yearly average from 2016 to 2019, prior to the pandemic,” predicted Kiplinger.
Inflation is expected to stay with us for a while and the disrupted shipping supply chain will affect our economy into the 2nd quarter of next year. This higher inflation could cause the Federal Government to intervene by raising interest rates earlier than planned.
In short, start shopping Rhinebeck!
Here Are Some Tips for Buying Your Holiday Goods
Start your shopping early. Don’t wait for major discounts like black Friday because items may not come on time.“Order what’s important early to increase the odds of it coming,” said Mr Moor.
Don’t be too picky. Don’t get held up on specific colors or models for your holiday shopping this year. More available and wide stocked items will be better to order early and to get here on time. “Don’t be picky on certain brands,” said Mr Moor.
Keep your shopping local. Pick up presents in your area weeks earlier than you need them and try to keep your shopping local.
Check shipping deadlines. In order to not be disappointed if your items do not come, check when they are estimated to arrive. Manufacturing holdups and shipping containers aren’t the only problems in the supply chain. According to Wired, FedEx and other shipping companies have had staffing shortages that could further slow down transport and delay shipping times.
Check the retailer. Bigger sellers like Walmart or Amazon have hired their own charters to get around port congestion. If you can’t buy early, try going into stores like Target or Walmart that will have their shelves filled. “Be sure to make compromises [for certain goods],” said Mr Moor.
Support the PTSO. The PTSO fundraiser has tons of gifts that you can shop for online and support our school.