A. Product Shortages
Many centers, shops, manufacturers, and distributors are reporting record sales. Imagine what our numbers might be if we had all the
product bowlers seem anxious to buy! At Classic we have always prided ourselves on the strength and reliability of our inventory. But so
many different variables have worked together to cripple the availability of so many basic items, everyone in the chain has had to make
do with sporadic product offerings. Among those variables:
1. Labor Shortages
All over the country job openings go unfilled, all the while the federal government is still paying out $300 unemployment subsidies
to those who choose not to return to the work force. At a minimum that is $650 a week to not go to work. The Wall Street Journal
recently reported “Job openings reached 9.3 million in April, the highest number since records began in 2000”.
A recent article posted by the Warehousing Education and Research Council July 30, 2021 said:
• “. . . according to a survey from Portland, Oregon-based Umpqua Bank . . . The company’s 2021 Business Barometer surveyed
1,200 business leaders from small and mid-market companies across the United States. The study found that most businesses
are poised for growth amid continued disruptions lingering from the pandemic, and that supply chain challenges top their list of
key concerns moving forward.
• The study found that 88% of small and mid-sized businesses have experienced at least some type of supply chain difficulty over
the past 12 months. The most common difficulties include being unable to purchase the goods they need to run their business
in a timely manner (24%); facing longer delays receiving goods (59%); and experiencing an increase in the price of goods (76%).
In addition, at least two in five small businesses and 55% of middle market respondents said they’re having trouble finding
qualified employees, which could be further contributing to global supply chain challenges, the authors said.”
I am willing to bet, like at Classic, that “two in five” businesses are having trouble finding qualified employees seems very low to
2. Raw Material Shortages
Most of our suppliers are reporting extreme backlogs for even the most basic components they need to build their products. The
materials needed to build bowling balls, bags, shoes, lane machines, chemicals, and pin setter parts are in short supply – which
invariably raises prices . . . often a lot.
This is a never before seen example of the growing consequences of material shortages throughout the country (world) and how
these problems are working their way into our everyday business operations:
From the Ohio Centers Association yesterday (August 19):
Over the last two days, I have gotten reports of 5 Ohio member centers being “dropped” by Sysco. This has happened unexpectedly
and immediately, even when members have an order scheduled to be delivered the very next day.
Below is an excerpt of the email received from Sysco by one Ohio member:
“We have been contacted by upper management this afternoon informing us that we are struggling with the warehouse and lack of
drivers and deliveries have been a nightmare. They also informed us that for the time being we will be cutting accounts starting today
because of all the struggles and a lot of accounts not getting delivered. I hate to tell you that your account was on the list to be cut. I know
it is so last minute, but we are being told that we have to stop the bleeding fast as we are sinking.”
Pandemic stimulus checks sent to individual households have had an effect. Along with subsidized unemployment checks stimulus
cash has put more discretionary money in consumers hands than ever before – and they are spending it.
Add to this the number of new bowlers that have come to our sport in recent months and it is easy to understand how demand has
surged beyond supply.
Our nation’s delivery systems are in the same condition as the rest of the world – a shambles. This is not an exaggeration.
• Once items are produced (particularly in foreign countries) they often sit at factory docks waiting for containers – there is a
• Once items are loaded into containers for shipping, they wait at factory docks to be picked up by a truck – there is a shortage.
• Once items are picked up by a truck they are transported to a port, where the container sits, waiting for available staff to process
the export – there is a worldwide shortage of such staff.
• Once a container is cleared for export the product waits, weeks and sometimes months, for a ship to take it across the ocean –
there is a worldwide shortage of ships.
• Once the ship arrives at a U.S. port it can sit for days, sometimes weeks, waiting at a port to be processed by the overburdened
terminals – there is a shortage of longshoremen and space to process imports.
• Once the goods move through the import process more delays occur, as defined in an article of Logistics Management magazine:
“. . . the Ports of L.A. and Long Beach experienced extreme cargo swings, falling to under 1 million twenty-equivalent units (TEUs)
in March 2020, then nearly doubling to 1.8 million TEUs a year later in March 2021. The import surge continues to break records.
Congestion triggered by this influx has corresponded with diminished rail capacity, longer truck turn times, and increased dwell
times for containers and truck chassis. Terminal dwell times, which measure how long containers remain at terminals, peaked in
January at over five days, more than twice the standard length. Meanwhile, street dwell times for chassis have also hit crisis levels,
exceeding the industry “red zone” of six days continually since November 2020. In fact, early December 2020 and January 2021
showed peak street dwell times for chassis at nine days – a full week above the optimal level of one to three days.”
In other words, it is a mess. I recently read a report by an economist that works for the Caterpillar Inc. strategic planning group.
His group’s best estimates are supply chains in the U.S. will not completely settle down before September 2022.
What this means in we will be dealing with delays and uncertain availability dates for at least that long.
Key points to take away from all of this:
• There is going to be a shortage of products, probably not balls but shoes, bags, lane machines, and some pin setter parts for sure
for the remainder of the year.
• We have issued this warning before, and we were right: Whatever you hope to have to sell leading up to the holidays should be
ordered now. It is important you get your order in the queue – orders will be filled based on when they were received, and we are
not confident there will be much available by the end of November.
• Estimated time of arrival (availability) has always been an important bit of information we offer on our B to B ecommerce site.
It is hard to keep it accurate because despite their best efforts the information the manufacturers have to share with us is very
tentative. But we do update our site as soon as we get input from our suppliers so check often to keep track of availability.
• Shortages always lead to price increases, as do increased shipping costs. Both are predominant factors in our supply chain right
now. Price increases are coming often, with no time allowed for “one last purchase at the old price”. Inflation is historically defined
as too much money chasing too few goods – that is exactly what we have going on right now. Waiting to order could expose you
to an even higher price than you are paying now.
• I do not believe our manufacturers are profiteering from all of this. If anything I believe their increases have been relatively
modest compared to so many of the common products and services, we all buy.
B. Shipping Issues
In an October, 2020 version of “View from the Middle” I wrote:
“PROBLEMS WITH UPS AND FEDEX GROUND SHIPMENTS
We are sorry to report that the typically reliable UPS and FedEx ground shipments have become uncharacteristically problematic.”
I am sad to say this was true then and the situation has only gotten worse. Our policy of shipping the same day any order placed that
clears credit by 4:00 p.m. has depended on the speed, accuracy, and dedication of our staff – which has always been so reliable. But
another key component of this system is the reliability of UPS and FedEx. This has been all the trouble I predicted in October, and worse:
1. They sometimes show up early and will not wait for us to finish packing, metering and palletizing.
2. Sometimes they show up on time but when they get our load back to the hub the hub is restricted (labor shortages, Covid absences,
etc.) and our packages are not processed or, sometimes they reroute our load to another hub (in another city) which adds a minimum
of a day to the delivery schedule.
3. Often once a load is moved to another hub it will sit 1-4 days because the hub cannot process all the packages it has – this is true
both for Classic’s shipments to you and manufacturer’s shipments to us.
4. Sometimes they don’t show up at all.
5. I hate to say this but please be careful promising product – the once super reliable You to Us to UPS/FedEx/LTL Carriers to You
system is still on time maybe 85-90% of the time but the miss rate is much higher than it used to be. Be careful with your promises –
encourage your customers to order as soon as they have made up their mind.
6. We have noticed more damaged deliveries than ever before. When this happens be sure to point the problem out to the delivery
person, note the problem when you sign for the delivery, and let us know right away.
7. Motiv waited until a week from the release of the Top Thrills to ship them. We need new release balls the day before the release date
in order to receive them into our system and call to verify customers still want us to fulfill their preorders. We got the balls Monday
the 16th instead of the 12th or sooner. Throughout the supply chain we are all going to have to make special allowances for the poor
condition of the shipping industry in our country if we are to sustain the level of service to each other and the bowlers that we have
provided in the past.
8. It is hard to imagine this all clearing up before the end of the year, which means we will all have to bake into our product procurement
schedules many extra days.
I do believe, like last year, that 80% of all orders will flow smoothly up to and after the holidays – but at least for now this is not
something we can count on or advertise.
9. USPS just announced that they will be applying “peak season surcharges” for holiday shipping. This is a rate increase that both UPS
and FedEx introduced last year, and all indications are they will do the same this holiday season as well.