Article | What I learned in Supply Chain
Uh oh, my shipment was cancelled!
July 22nd, 2021
4 minute read
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Every week, Mercado CEO Rob Garrison pens his latest learnings from the supply chain industry as part of an on-going series. Each article aims to share a little insight into what's going on that week, and to help foster discussion amongst industry professionals across levels, geographies, and companies.
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I spoke to an importer who told me they have had 20 shipments cancelled from Taiwan. The cause? No containers.
The suppliers made the products as per the purchase order, however with no ability to ship it to this customer, they were forced to cancel the order and sell the product to a different customer in another country.
The situation is so dire in Taichung that even a $25,000 bill won’t guarantee you a container.
When carriers cancelled sailings due to low demand last spring, it set off the supply chain reaction that we are experiencing now. The “blank” sailings meant no container repositioning in a market that is 4:1 inbound to outbound.
When trade bounced back in late summer, there was a shortage of containers. This shortage created panic buying, a change in ordering patterns, and a frenzy not unlike the Great Tulip Panic in the 1600s.
All this is well documented, but less understood is what it will mean to consumers who will increasingly feel the pinch of product shortages and rising prices heading into back to school and the holiday season.
I am in the camp that the container shortage was a self-inflicted wound.
When carriers cancelled sailings due to low demand last spring, it set off the supply chain reaction that we are experiencing now. The “blank” sailings meant no container repositioning in a market that is 4:1 inbound to outbound.
When trade bounced back in late summer, there was a shortage of containers. This shortage created panic buying, a change in ordering patterns, and a frenzy not unlike the Great Tulip Panic in the 1600s.
All this is well documented, but less understood is what it will mean to consumers who will increasingly feel the pinch of product shortages and rising prices heading into back to school and the holiday season.
About the author(s)
About the Series
Each week, Mercado CEO Rob Garrison pens his latest learnings from the supply chain industry as part of a series run for his LinkedIn followers. Each article aims to share a little insight into what's going on that week and to help foster discussion amongst industry professionals across levels, geographies, and companies.
You can connect with Rob on LinkedIn by following this link.
Each week, Mercado CEO Rob Garrison pens his latest learnings from the supply chain industry as part of a series run for his LinkedIn followers. Each article aims to share a little insight into what's going on that week and to help foster discussion amongst industry professionals across levels, geographies, and companies.
You can connect with Rob on LinkedIn by following this link.
