Although there are all kinds of articles out right now about the issues happening throughout the supply chain, talking with these importers one-on-one really gave me a lot more color on all of the cost pressures they face on a daily basis.

These companies have so much demand that they can’t even keep up with it. However, with all the cost increases happening on a weekly basis, they aren’t profitable. If there isn’t relief soon, they will either have to raise their prices dramatically or quit taking new orders altogether.

Just some of the cost increases they currently face include:

1. An increase in cost of their primary raw material — steel — which is now at a 13-year high. With such a short supply, the cost is expected to increase even further
2. On top of the rising cost of steel, it is also subject to a 25% duty
3. Overall labor costs have risen dramatically as they can’t get enough workers in their distribution centers
4. Domestic transportation costs have doubled
5. International transportation costs are up five fold

When I was an importer I never had to contend with any of these issues. Back then, we also had a much simpler “hub and spoke” model designed to minimize transportation costs. Today’s importer does not have this luxury. Buy anywhere, sell anywhere has made supply chains much more complex. Layer on the international “events” of the past year and a half, and now the massive inflation, and you have a perfect storm.

Fortunately, the tools to help importers manage through this have become increasingly sophisticated as well for those who have begun to digitize their supply chains.