As the holiday season nears and families across the country prepare to observe the traditions that make their celebrations special, the state of the global supply chain has been thrust into the spotlight.
The COVID-19 pandemic is wreaking havoc on the way goods are not only produced, but also how they move around the world. And as backups at ports mount and leave store shelves with scant supply, folks in the U.S. are scrambling to find the items they rely on to make the season bright.
Cesar Romero, operations manager of the Latin-American grocery store El Condor in Logan Square, says that the past 20 months have definitely caused disruptions in their business, in particular packaging supply issues.
“We’ve definitely seen a shortage in glass containers, and that’s led to drink bottles made of glass and pepper pastes, which is a big hit with the Peruvian and Ecuadorian community,” said Romero. “And now containers are taking a lot longer to get from point of origin to Chicago. Before it used to take 3-4 weeks but now it’s 2-3 months. Considering that the price for freight-forwarding has at the very least tripled or quadrupled … now it’s really forcing our hands to consider raising prices.”
Romero says the business has tried to adapt by looking into different suppliers.
“We’ve adjusted just by trying to see what other sources have been selling them. Maybe not in the same packaging,” Romero said. “Glass is what the consumer and the clients and the community know and recognize and like, so … we pretty much try to give them what they want … We’re transparent, we’re letting them know, we’re just trying to adjust.”
Loyola University Chicago’s Quinlan School of Business interim dean Maciek Nowak says that while the pandemic is to blame for the initial disruptions, that has morphed into a new problem.
“At this point the biggest factor is labor shortage. There’s just not enough people who are available, whether it’s truck drivers, port personnel, warehouse personnel, to move all of these containers,” Nowak said. “The labor market is doing really well right now so these aren’t necessarily the most high-end jobs, and people are finding other employment that might be preferable.”
Nowak says he anticipates the logistics disruptions are here to stay through the holiday season.
“Long term … we’re going to need more people to come back to the industry and that that may be increasing wages in those different areas … to attract more people. The market, you would imagine, will balance out eventually,” said Nowak. “If there’s such a demand, these companies are going to have to increase their wages to attract more personnel, so I would expect to see that, but that takes months … I would say it’s mid-year next year at best where we start to see maybe a return to normalcy.”