MIDLAND Midlanders are experiencing frustrating shortages and higher prices during their holiday shopping. The hard-to-find list keeps growing longer: from video game consoles to cream cheese and beverages. What is next? Intricate global supply chain issues are to blame, and Midland College (MC) Business Professor Doug Johnson can help break down the topic.
“This is a complicated issue, but it is a fun time to be teaching,” Johnson explains. “Current events are giving me a plethora of topical subject matter to go over with students. The supply chain is usually, by all means, invisible and taken for granted. It is an intricate dance between manufacturers and transportation companies to take goods from where they are created to their next step whether that be another company for further manufacturing or to a consumer at a store.”
The pandemic has global supply chain in this topsy turvy state.
“If COVID shut factories down because workers were sick, transportation companies responded by cutting schedules,” Johnson said. “It is a yin/yang relationship. The supply chain needs adequate time to adjust; it is not just a quick, one-step, one-company process. But COVID is not the only culprit. You would not know this unless you worked at a certain company, but inventories have been purposefully kept very lean to keep costs down. Companies were not prepared for a scenario where they could not simply order more of what they needed, so they had to adjust quickly to dwindling supplies and think of other ways to obtain the needed supplies.”
Also, products like electronics and cars are getting more intricate. They are assembled with parts from around the world.
“Shortages breed more shortages,” Johnson said. “It is an unforgiving cycle.”
Besides not finding what we need at the store, customers should expect supply chain issues to hit them where it hurts, in the wallet.
“We have been dealing with supply chain issues for probably a year and a half, all the way back to the beginning of the pandemic,” Johnson said. “The longer these issues persist, the more likely manufacturers and transportation companies will start pushing their costs onto consumers in the form of price hikes.”
All these issues will control purchases for some time. It is anyone’s guess when things will get back to normal.
“The end of the holiday shopping season can hopefully provide some sort of relief in a trickle-down manner,” Johnson said. “Shipping can increase for items other than gifts and some companies have learned to increase inventories.”
