The Supply Chain problemo gets personal...
Angling for a Merry ‘Fishmas’ Despite Global Shipping Delays
The travails of a Chicago fishing company’s advent calendar highlight the supply chain hurdles for businesses trying to deliver items in time for the holidays.
WASHINGTON — It was 73 days until Christmas, and the clock was ticking down for Catch Co.
The Chicago-based fishing company had secured a spot to sell a new product, an advent calendar for fishing enthusiasts dubbed “12 Days of Fishmas,” in 2,650 Walmart stores nationwide. But like so many products this holiday season, the calendars were mired in a massive traffic jam in the flow of goods from Asian factories to American store shelves.
With Black Friday rapidly approaching, many of the calendars were stuck in a 40-foot steel box in the yard at the Port of Long Beach, blocked by other containers stuffed with toys, furniture and car parts. Truckers had come several times to pick up the Catch Co. container but been turned away. Dozens more ships sat in the harbor, waiting their turn to dock. It was just one tiny piece in a vast maze of shipping containers that thousands of American retailers were trying desperately to reach.
“There’s delays in every single piece of the supply chain,” said Tim MacGuidwin, the company’s chief operations officer. “You’re very much not in control.”
Catch Co. is one of the many companies finding themselves at the mercy of
global supply chain disruptions this year.
Worker shortages, pandemic shutdowns, strong consumer demand and other factors have come together to fracture the global conveyor belt that shuffles consumer goods from Chinese factories, through American ports and along railways and freeways to households and stores around the United States.
American shoppers are growing nervous as they realize certain toys, electronics and bicycles
may not arrive in time for the holidays. Shortages of both finished products and components needed to make things like cars are
feeding into rising prices, halting work at American factories and
dampening economic growth.
The disruptions have also become a problem for President Biden, who has been vilified on Fox News as “the Grinch who stole Christmas.”
The White House’s supply chain task force has been working with private companies to try to speed the flow of goods, even considering deploying the National Guard to help drive trucks. But the president appears to have limited power to alleviate a supply chain crisis that is both global in nature and linked to much larger economic forces that are out of his control. On Sunday, Mr. Biden
met with other world leaders at the Group of 20 in Rome to discuss supply chain challenges.
On Oct. 13, the same day that Catch Co. was waiting for its calendars to clear the port, Mr. Biden announced that the Port of Los Angeles and companies like FedEx and Walmart would
move toward around the clock operations, joining the Port of Long Beach, where one terminal had begun staying open 24 hours just weeks before.
“This is a big first step in speeding up the movement of materials and goods through our supply chain,” Mr. Biden said. “But now we need the rest of the private sector chain to step up as well.”
Mr. MacGuidwin praised the announcement but said it had come too late to make much difference for Catch Co., which had been working through supply chain headaches for many months.
The company’s problems first began with the pandemic-related
factory shutdowns in China and other countries, which led to a shortage in the graphite used to make fishing poles. A worldwide
scramble for shipping containers soon followed, as Americans began spending less on movies, travel and restaurants, and more on outfitting their home offices, gyms and playrooms with products made in Asian factories.
Shipping rates soared tenfold, and big companies turned to extreme measures to deliver their goods. Walmart, Costco and Target began
chartering their own ships to ferry products from Asia and hired thousands of new warehouse employees and truck drivers.
Smaller companies like Catch Co. were struggling to keep up. As soon as Apple launched a new iPhone, for example, the available shipping containers vanished, diverted to ship Apple’s products overseas.
The timing could not have been worse for Catch Co., which was seeing demand for its poles, lures and other products surge, as fishing became an ideal pandemic hobby. The company turned briefly to air freighting products to meet demand, but at five or six times the cost of sea freight, it cut into the company’s profits.
The supply chain woes became an even bigger problem for Catch Co.’s “12 Days of Fishmas” calendar, which featured the company’s plastic worms, silver fish hooks and painted lures hiding behind cardboard windows. The calendar, which retails for $24.98, was a “big deal” for the company, Mr. MacGuidwin said. It would account for more than 15 percent of the company’s holiday sales and introduce customers to its other products. But it had an expiration date: Who would buy an advent calendar after Christmas?
Mr. MacGuidwin thought briefly about storing late arrivals for next year before realizing the calendar said “2021.”
“It cannot be sold after Christmas,” he said. “It is a scrapped product after that.”
Like many American companies, Catch Co. had tried to prepare for the global delays.
Inside the Box
The twin ports of Long Beach and Los Angeles — which together process 40 percent of the shipping containers brought into the United States — have struggled to keep up with the surge in imports for many months.
Together, the Southern California ports handled 15.3 million 20-foot containers in the first nine months of the year, up about a quarter from last year. Dockworkers and truckers had worked long hours throughout the pandemic. More than 100 trains, each at least three miles long, were leaving the Los Angeles basin each day.
But by this fall, the ports and warehouses of Southern California were so overstuffed that many cranes at the port had actually
come to a standstill, without space to store the containers or truckers to ferry them away.
On Sept. 21, the Port of Long Beach announced that it had
started a trial to keep one terminal open around the clock. A few weeks later, at Mr. Biden’s urging and with the support of various unions, the Port of Los Angeles and Union Pacific’s nearby California facility
joined in.
So far, few truckers have arrived during the expanded hours. The ports have pointed to bottlenecks in other parts of the supply chain — including a shortage of truckers and overstuffed warehouses that can’t fit more products through their doors.
“We are in a national crisis,” said Mario Cordero, the executive director of the port of Long Beach. “It’s going to be an ongoing dynamic until we have full control of the virus that’s before us.”
In the past, Catch Co. would often ship products from West Coast ports by rail. But longer travel times on rail lines — as well as the high demand for containers at Chinese ports — mean shipping companies have been loath to let their containers stray too far from the ocean.
So instead, the Catch Co. calendars were moved by truck to a warehouse outside the port owned by freight forwarder Flexport. There, they were placed on another truck to be shipped to Catch Co.’s Kansas City distribution center, where workers would repack the calendars for Walmart.
Mr. MacGuidwin estimated that the calendars would arrive in Walmart stores by Nov. 17 — just in time for Black Friday. The calendar’s entire trip from factory to store shelves would take about 130 days this year, compared with the typical 60.
Mr. MacGuidwin said he believes supply chain difficulties may ease next year, as ports, rails and trucking companies gradually work through their backlogs. Asia remains the best place to manufacture many of their goods, he said. But if shipping costs remain high and disruptions continue, they may consider sourcing more products from the United States and Latin America.
Catch Co. has already started designing its calendar for next year and is still deciding whether it should say “2022.”
“It’s an open question,” said Mr. MacGuidwin.
