Supply chain issues: “There are indeed problems everywhere”, even for small companies

(CBS Baltimore)-Why are the shelves of the local grocery store always partially empty? Why is the delivery time much longer than before? Why is everything expensive? The short answer is the supply chain question. The long answer to explain the causes of these supply chain problems is not that simple.
There is no doubt that the once-in-a-lifetime COVID pandemic has exacerbated existing problems. This includes a shortage of workers on the path of products from the factory to the door of the consumer, which creates multiple bottlenecks in systems that rely on timely operation, just as the demand for these products has increased sharply.
Even more complex explanations cannot fully explain why consumers cannot buy what they want when they want it. That’s because there is no simple answer, and there is no simple fix.
The supply chain is a series of steps to bring products to customers. Martin Dresner, professor and chair of the Department of Logistics, Business and Public Policy at the RH Smith School of Business at the University of Maryland, described it as “a network of manufacturers, their suppliers, distributors, and retailers, responsible for the starting point from the end customer. ”
Any given company’s network can start with suppliers of raw materials and other inputs, including the delivery of these supplies to manufacturing plants. Once the input is converted into a finished product, it will be transferred to a warehouse or store, and then finally handed over to the end customer. Various agents, brokers, suppliers, transportation companies and distribution centers can play a key role in ensuring that products are manufactured and reach their final destination.
The supply chain of a large company can quickly become very complicated. Dresner described how complicated it is in the example of a typical packaged goods company: “Packaged goods manufacturers have many suppliers, and these suppliers will provide the raw materials used in the production process. It may be farmers, or farmers can do it through distributors. Sales. Or the products used by the manufacturer may be self-made, so they may have other component suppliers.
“We consider suppliers that sell directly to Procter & Gamble or Kellogg’s to be Tier 1 suppliers,” he continued. “But there are people who supply them. We call these suppliers second-tier suppliers. And there may be third-tier and fourth-tier suppliers, all the way back to the origin of the product components. The manufacturer may not do it on its own. All manufacturing. They outsource some manufacturing. These contract manufacturers are also suppliers of packaged manufacturers. They have their own supply chain.”
“Manufacturers usually don’t sell directly to customers, but sell through distributors,” Dresner explained further. “Distributors can sell to retailers, and manufacturers can sell directly to retailers. There may be other companies involved in the sale and distribution of products. There can be agents, brokers, and transporters. There are various companies that need to participate in the Products are delivered to end users. All these companies are part of key companies, the supply chain of packaged goods manufacturers.”
So many steps along the way leave many opportunities for slowing down. These slowdowns add up to each other, causing more and more delays for the company.
Now imagine that every company that produces and/or sells physical products has its own unique supply chain. Some are more complicated, some are simpler. But they all have some basic elements in common. And everyone uses the same regional, national and global system (hopefully) to deliver products to consumers in a timely manner. This broader global commodity pipeline is the “supply chain,” which made headlines for causing delays and pushing up prices.
Cargo ships carrying as many as 500,000 containers filled with cargo from various Asian countries are waiting to be unloaded at the ports of Los Angeles and Long Beach. Once unloaded, the shortage of truck drivers will prevent these goods from being shipped out of the port in time. The railway terminal is a place where trucks transport goods for the next station, with containers waiting for further transportation as a backup, which in turn prevents trains entering the station. If these goods enter the warehouse in some way, a shortage of workers will limit their timely handling. And, as if this were not enough, the US Postal Service recently slowed its delivery time.
The COVID pandemic is definitely to blame for a series of problems in the supply chain. But this is not the only culprit.
The global shortage of microchips, which has been aggravated by domestic production due to the winter storm in Texas, is slowing the production of automobiles and various electronic devices. China, which produces many consumer goods destined for the United States, is suffering from a continuing energy crisis, causing manufacturing to shrink. Manufacturers in many other countries with low vaccination rates have already endured shutdowns and worker shortages caused by the spread of the Delta variant.
The Association of Unemployed Philosophers (UPG) is one of many companies that solve supply chain problems that affect the entire market. This Brooklyn-based gift company specializes in making and selling smart and interesting gifts for smart and interesting people, or, as their website says, “satisfy people’s needs for finger puppets, warm slippers, coffee cups, and things. ”
UPG Sales Director Trudi Bartow said that celebrity finger puppets, known as glamour figures, are one of the most popular gifts. Current bestsellers include former Supreme Court Judge Ruth Bud Ginsburg, former painter and TV presenter Bob Rose, and President Biden’s chief medical adviser Anthony Fauci.
“We worked with the manufacturer to produce this product,” Barto said. “What I want to say is that 65% of our products are manufactured overseas, which is slightly different from products manufactured in the United States. Now most of the supply chain issues are overseas issues, so I will focus on that. Once we The manufacturer of manufactures the product, we load it into a container, and then load the container onto a ship. We transport that ship to the United States and it goes to a port. It is taken off the ship. The container is placed in On the track. The railway enters our warehouse. Our warehouse takes the container and puts it all on the shelf and marks it all as inventory. Then we sell it to a physical store or an online store, it doesn’t matter. Then Take the product out of the warehouse, put it on a truck, transport it to the store, and then put it on the store shelf, whether physically, so that someone can walk in and take it out and buy it, or buy it in some online store and then Was shipped to them.”
Like many other UPG products and merchandise in the entire market, these finger puppets will take longer to be on the market. “We are not unique, any gift manufacturer or manufacturer of any product is unique,” Barto said. “There are many problems in the whole process, the whole supply chain…There are indeed problems everywhere.”
The United States is the largest economy in the world. Individual consumer purchases account for more than two-thirds of economic activity. Some of these purchases are services, such as dry cleaning or dining in high-end restaurants. Some of these purchases are merchandise, which can be Anthony Fauci’s finger puppets or an SUV worth $45,000. Many Americans, especially those with discretionary income, have turned their spending toward commodities when trapped at home during the pandemic. The stimulus check gave them more money to buy things. Since then, consumption habits have been biased towards commodities, which has made the calibrated supply chain more balanced.
Approximately 90% of products will travel across the ocean to reach consumers. For the magnetic finger puppets destined to be displayed on a neighbor’s refrigerator, the trip started in a manufacturing plant in China, along with thousands of other small finger puppets.
The manufacturing plant may have encountered a problem. According to Barto, “it can start from overseas factories, the cost of goods has risen, and the electricity bills of China’s power grid have increased, especially in the case of COVID. The warehouse is closed and cleaned at the same time. The distance from the production workshop has caused delays.”
Once the little Anthony Fauci is created, it must find its way to the port, where a ship can take it across the Pacific Ocean. “There is actually a lack of drivers everywhere, so transporting containers to the port is tricky because there is a backlog now,” Barto explained. “Then things will stay in the port for a long time because of the seafarers and ship delays. So now you don’t have to sit there for a week or two, but you can sit there for a few weeks or even wait for a reservation. Once you’ve booked, the terminal It will take longer for workers to get your things on board.”
That Anthony Fauci said that the time when the couple crossed the ocean has not changed. But the time for him to transfer to the next stop has come. “Now you have arrived, for example, the Port of Los Angeles,” Barto continued. “Instead of spending a week cleaning up and disembarking the ship, it may take two, three weeks or even longer because of the long queues at the Port of Los Angeles. Again, these are constraints on the supply chain. There are not enough dock workers. There are terminals there. Workers are subject to safety restrictions. COVID has a downtime. Working hours will increase or decrease. So this increases delays.”
In the end, Anthony Fauci Finger Puppet and all his finger puppet friends found a way to enter the Port of Los Angeles and disembark. But the delay continues. “There is a shortage of drivers. There is a shortage of trucks. There is a lack of physical containers for moving items back and forth.”
After a long journey from the port, the finger puppet arrived at the warehouse. “The warehouse faces the same obstacles as everywhere else,” Barto pointed out. “Labor shortage has led to a shortage of packaging containers. Containers can be placed outside the warehouse for one to three weeks.”
But the journey is not over yet. When an online or physical retailer orders 100 Anthony Fauci magnetic figures, a box is sent to the store. There, customers can purchase finger puppets in person or online. At that time, the American mail system took over. In order to cut costs, the U.S. Postal Service has begun to slow down delivery. For consumers, the inevitable result will be more delays in the last stop of the finger puppet journey.
Due to problems throughout the supply chain, consumers are facing increasing shortages, higher prices, and delivery showdowns of various commodities throughout the economy. This may mean wines from Northern California, as producers try to source bottles and label paper. This may also mean food from the local grocery store, as it is difficult for retailers to stock. This may even mean artificial Christmas trees and decorations, which are currently stranded in ports across the country.
For the upcoming holidays, all supply chain problems do not bode well. The massive delays are expected to be a potential gift, slowly crossing the ocean, passing through ports, along highways and railroad tracks to warehouses and shops.
Therefore, if you wish to give away Anthony Fauci finger puppets to remind friends and relatives to wear masks, it may be a good idea to order as soon as possible.


Post time: Oct-27-2021
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