The Domino Effect: Customers See Delays and Higher Prices Due to Supply Chain Tension – Halifax
People like Lisa Whittingham know very well how frustrating delays can be when you just want to finish a home renovation completely.
She and her husband recently completed most of a kitchen remodel and were shopping on Monday for stools for their countertop.
But they were surprised to hear what it would take.
“Everywhere we’ve been they’ve told us we’re looking, the shortest time has probably been 16 weeks, but most places say six months, maybe,” Whittingham says.
The supply chain represents all stages of how a customer’s demand is met, from sourcing to manufacturing, distribution to delivery.
Why is everything you want out of stock or more expensive
The COVID-19 pandemic has reduced people’s mobility and purchasing habits, and some manufacturing shutdowns have had ripple effects.
Now the demand is back, but not yet the supply.
This pushes up some prices and increases pressure on the supply chain, says Ali Ülkü, director of the Sustainable Supply Chain Analysis Research Center at Dalhousie University.
“There is an increase in prices due to the scarcity or uncertainty and even the unpredictability of production capacity,” explains lkü.
Delays aside, supply shortages can result in less choice for consumers.
“You have in mind what you want it to look like and how you want it to be, and you want it to be finished,” says Whittingham. “Now it’s like I’m waiting and waiting and waiting… and I can’t always get the products I want, so that’s the other frustration. “
Don Jordan, general manager of Jordan’s Furniture in New Minas and Halifax, as well as La-Z-Boy in Halifax, said custom orders before the pandemic would take a manufacturer eight to 12 weeks.
Now it can take nine months or more, he says.
“I’ve been doing this for about 40 years, I’ve been through recessions and stuff like that, but nothing, nothing like it,” Jordan says. “In the furniture industry, there was also a strong demand for the product and household appliances. I mean, we also have people who wait nine months for special devices, so that impacts everything in our business.
The business world is known for its results, says lkü, who has been studying supply chains for 20 years.
The pandemic offers an overhaul, he says.
He says government, education and consumer decisions all need to focus on “the quadruple bottom line.”
“Consider not only the financial result,” he says, “but also the environmental result, the societal result, the cultural result. “
The labor shortage problem is compounding the pressure, forcing people like GM Don Jordan to play an even bigger role in the company.
Growing number of trucker vacancies adds to ‘huge’ supply chain pressures
“I’ve been on the (delivery) truck myself when the guys don’t show up or aren’t with us anymore, but I mean, that’s what you have to do,” he says. “We want to make sure that when customers wait as long as they are, that they aren’t disappointed about having to cancel or having a truck on the road, which we have had to do on occasion. . “
He says the majority of customers have been understanding, but some are not.
There is no clear timeline on when we can return to “better normalcy,” says Ülkü.
“It depends on the collective effort of the whole world, from developed countries to underdeveloped countries,” he said. “We cannot isolate ourselves from the pandemic and say that we will bounce back in a year or two is an open question.
“My hope is that we learn from it and start living more sustainably. “
Consumers hope for the best.
“I hope that over time it gets better,” said Whittingham. “This is my hope.”
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