Supply Chain Problems Continue As The Holidays Approach | Local News


Despite the supply chain crisis, the Man’s Hat Shop in Albuquerque has enough business to cover overhead costs and more.

On the occasion of the 75th anniversary of his company, Stuart Dunlap is having his best year, despite being overwhelmed, like many companies, by the problem of national and global supply. Demand, he says, is high.

“We will be very limited on inventory,” Dunlap said of the upcoming holiday shopping season. “But we also sell a lot of gift certificates. “

A faculty member at the University of New Mexico says the supply crisis reflects a convergence of problems. They include a shortage of truck drivers in the United States, a backup of container ships on the west coast docks, and a clamor for products due to stimulus checks.

The effects can be widespread enough to restrict the availability of sneakers, shirts, cars and home appliances for the holidays. Even the electricity supply could be affected in the long run, according to the New Mexico Public Regulatory Commission.

“It’s bad enough,” said Dave Dixon, economics lecturer at UNM, of the procurement challenge. “It’s a really complex problem. Right now things are going to be more expensive. They will take longer to get there.

A state business leader recommends holiday shoppers buy early and locally if they hope to avoid national and global supply issues that may worsen before they get better.

Rob Black, chief of the New Mexico Chamber of Commerce, said store supplies would run out sooner and stores would have a harder time restocking.

“So I think you better get what you need now for the holiday season,” Black said on Friday. Buying local, he said, will avoid problems with delivering products to homes.

The Public Regulatory Commission on Friday asked utilities in the state to report the impact of the problem on their operations. The New Mexico utility company, for example, told the commission this summer that its contractors were struggling to secure equipment for renewable energy systems to replace the coal-fired power plant in San Juan in the northwest of the state.

PNM executive Tom Fallgren even suggested in August that the company might consider keeping the plant open beyond its scheduled shutdown in June 2022. PNM spokesman Ray Sandoval said on Friday that this had was briefly considered but will not happen, in part because PNM’s mining contract ends in June, which poses contractual and regulatory challenges. The mine is expected to close next year.

“It is now very evident that global supply chain issues affect everything, not just materials for renewable energy projects,” said Commissioner Joseph Maestas of Santa Fe.

Commissioner Jefferson Byrd, a rancher near Tucumcari, said the supply crisis was a problem for many companies. “It’s ridiculous what doesn’t show up some weeks and some months,” he said. “And then next week or next month, it’s going to be something else that you can’t get.”

Byrd has said on several occasions that he has had difficulty acquiring brass barrels, PVC materials, wooden rods and solar panels.

An associate professor of logistics at Michigan State University said the supply problem is mainly related to stimulus money that was issued to Americans during the pandemic. “It comes down to the fact that people are buying more,” said Jason Miller.

The third stimulus check, issued in March, helped record demand for clothing and footwear, Miller said. Government statistics show that personal income in March was 25% higher than in January 2020.

With consumers stuck at home due to the pandemic, Americans earlier this year bought more furniture, large and small appliances, computers and video games, he said, and three stimulus money installments gave them the money to afford them.

When it comes to safeguarding container ships, he said, US ports in the first eight months of this year handled 16.9% more cargo by weight from containers than during the first eight months of 2019. This is a record amount, he said, part of a “never-ending peak season” due to “prolonged high demand”.

The idea that the supply chain is broken is wrong, he said. “It’s tense, but we’ve handled a record number of imports this year.”

Many see the shortage of truckers as a key part of the supply chain crisis. Johnny Johnson, chief executive of the New Mexico Trucking Association, said, “We were already running out of drivers before the pandemic hit.”

The disease and its blockages have made matters worse, Johnson said, and an expected federal mandate for COVID-19 vaccinations for companies with 100 or more employees will make matters worse.

“There is not a state that is not affected” by the shortage of drivers, he said. Young people don’t fill openings left by older drivers leaving the field, he said.

The American Trucking Associations has estimated that the truck driver shortage will hit a record 80,000 this year. Miller said his own research using federal statistics indicates the problem is not that serious.

Still, most agree that the supply chain cannot meet demand at this time. Moody Analytics reported this month that the situation will get worse and cited the shortage of truck drivers as the reason.

Car dealers have been suffering for months now from a shortage of computer chips that has reduced the availability of new cars. Buddy Espinosa, general manager of Toyota of Santa Fe and Enchanted Mazda, said he typically has 400 new cars available, but currently has 20.

“The demand is strong, and that means the gross profit is higher,” Espinosa said.

Dunlap at the Man’s Hat Shop looked bullish on Friday, although he acknowledged that the supply is low. He gets a lot of his hats from Texas manufacturers, he said, but there appears to be a shortage of boxes, leather and lining as well as a lack of manpower in the industry. His typical inventory is 5,000 hats, he said, and it is currently 1,500.

He said it used to take four to six weeks to receive a shipment of hats and now it takes six to seven months.

And people want hats. Baby boomers with thinning hair want it. The lawyers want them. Dunlap said film workers wanted them too, as did golfers and, of course, ranchers. They want felt hats, straw hats, western hats and dress hats, he said.

He had to go back to John Travolta Urban Cowboy period from the early 1980s to recall an era of such demand for hats. He could use more hats now, he said, because the business is great.

Source link


About Author

Leave A Reply