The world — truly the entire globe — is in the midst of a shipping crisis. As a result, manufacturers literally can’t get their merchandise to end-users without an extensive delay.
What is the global shipping crisis? A tremendous amount of goods are transported from one destination to another, often one continent to another, in metal “intermodal” shipping containers loaded onto enormous shipping vessels. It’s said that 80 percent of goods are moved this way — home goods, tech, apparel, raw materials, even computer chips. Usually the logistics system runs smoothly: A container leaves China, say, is emptied in Rotterdam, filled again and sent to the United States, is emptied and filled again and goes back to China.
Not now. A couple of months after the pandemic started in 2020, the system went far off track. Homeowners were suddenly forced to shelter in place and created a huge demand by ordering items like home office furniture and treadmills, filling up these shipping containers. At the same time, some containers were abandoned, empty, at slow ports since it wasn't anticipated how high the demand would be. Now the shipping companies are focusing all their attention on the busiest destinations, including China and the United States, and often skipping others altogether. In fact, one container line has cut off all Latin American business for now.
Meanwhile, docks have been understaffed since workers need to be physically spaced apart for safety, quarantine at home when exposed to Covid-19, miss work when they are sick with the virus, or need to tend to their children who are home all day instead of in brick-and-mortar schools. Plus, truck driver ranks have dropped drastically due to illness, quarantining and home responsibilities, while demand is at a record high. This slows goods from getting to and from the ships to the warehouse facilities that need to fill orders.
When it rains it pours, right? So the container ship Ever Given got stuck in the Suez Canal for nearly a week in April 2021. That stopped all container traffic there in both directions for several days. Some nasty winter weather slowed things down more in Europe. Both of these issues caused even further delays.
How bad is the problem? Outside Los Angeles and Long Beach, California, for example, more than two dozen ships at times remain anchored offshore waiting for their turn at the dock for two weeks. At the peak, that number was 40 ships. About 30 percent of the United States’ $220 billion of imported goods come through that gate, so that’s a huge portion of the United States’ merchandise. In February 2021, container ships filled with winter 2020 holiday decorations, among other items, were sitting off the coast of Africa waiting for their turn to be unloaded. An organization called UNCTAD (United Nations Conference on Trade and Development), among others, is working to improve the maritime supply chain in a variety of ways, including “Maritime informatics.” In practical terms, it might take about nine weeks to receive a shipment that would have arrived in half that time pre-pandemic.
What’s more, Asia ports are short on equipment and that’s not going to improve anytime soon. Demand to ship cargo is likely to continue at this intense pace through 2021, at the very least. Holiday and back-to-school purchases made August a peak season, and cooler temps are causing Covid rates to rise once again. Asia simply isn’t getting containers back quickly enough to meet the high demand.
So what happened? Delays hurt businesses and end-users. Global shipping costs have quadrupled, with differences regionally. In late 2020 and early 2021, the cost to ship goods was the highest in history. What used to run $1,000 might now demand as much as $10,000, and some experts cite price spikes of more than 440 percent to less-popular ports, 60+ percent for popular routes like China to Los Angeles, and 53 percent across the Atlantic. That’s if you can even find space on a ship for your container. And if you can access a container. Ultimately, the businesses and individuals who buy goods shipped from abroad have already seen prices of merchandise rise, and more price increases are imminent. (This crisis has been a bonanza for shipping companies and container manufacturers.)
In summary, all home goods manufacturers and importers are working tirelessly to bring in the goods are quickly as possible.
What is Rugs Done Right doing to help with the bottleneck issue of high demand and lack of transportation logistics?
First of all, we are preferred dealers of most top quality rug brands, and therefore have priority placement for shipping. As soon as the goods are brought in, our orders get filled.
Secondly, we regularly explore air fright options to send rugs from overseas. The cost to fly rugs from Asia is incredibly high, and this cost is never passed on to the customer.
Lastly, we feel transparency is paramount. All lead times are checked regularly and posted on the product page under the "View All Sizes and Stock" section. For existing orders we make it clear if the rug is out of stock, and that there is no other source who can get the same exact rug sooner.
We hope this detailed explanation helps to inform our valued customers about the logistics delays. We greatly appreciate your patience and understanding and support through these unprecedented times.