Supply chain disruptions hit Main Street

Small retailers worry about stocking shelves and serving customers

As concerns about the COVID-19 pandemic ease, small businesses are seeing customers return to their stores, eager to shop. But the pandemic has placed significant strains on global supply chains, making it more difficult for retailers to source products in an efficient, timely and affordable manner.

These challenges have reached Main Street retailers across the country, leaving them with more questions than answers on how they will stock their shelves, maintain reasonable pricing and serve their customers as we head into the holiday season.

 “While consumer demand has increased and we are expecting that to continue through holiday, I am worried I will not have sufficient product to meet the demand,” says Sarah McDonald of Out There Outfitters in Wayne, Pa.

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V.K. Electronics, an appliance, furniture and electronics small business in McCook, Neb., is experiencing supply shortages across all of their major product lines, which is “causing lots of frustrations for small retailers,” according to owner Linda Taylor.

A number of compounding issues are contributing to the supply chain disruptions and have small retailers struggling to fill their shelves.

Port congestion, product scarcity, labor and equipment shortages, among other issues are to blame for stretching the supply chain from end to end. For Jessica Bettencourt of Klem’s in Spencer, Mass., supply chain disruptions mean missed opportunities to generate revenue owner from the family-owned general store. “We are missing out on thousands of dollars in sales due to lack of product availability,” she said.

In addition to difficulty sourcing products to fill their shelves, small retailers are facing increased shipping costs and surcharges, forcing them to consider raising prices to pay the fees.

“One of our suppliers levied an across-the-board price increase of approximately 10-15 percent per garment, and then followed with an additional $50.00 ‘delivery surcharge’ on top of that,” says Danny Reynolds, owner of women’s boutique Stephenson’s of Elkhart in Elkhart, Ind.  “While we hate to pass these kinds of increases on to our customers, this particular vendor has made it even more difficult.”

While there is not one easy solution to all of the current supply chain challenges, a bill recently introduced in Congress could provide much-needed assistance in addressing some of the longstanding, systemic supply chain and port disruption issues that have been further exacerbated by the pandemic.

The Ocean Shipping Reform Act of 2021, introduced by Congressmen John Garamendi, D-Calif., and Dusty Johnson, R-S.D., would update federal regulations for the global ocean shipping industry to help level the trade playing field for U.S. companies, especially retailers who rely on the global maritime system to support their businesses.

For Bobby Djavaheri of Yedi Houseware Appliances in Los Angeles, relief cannot come soon enough. “Our business is continuing to grow, however, the ocean freight issue is unprecedented and causing a very big headache,” he says. “It is arguably much more disruptive than the tariffs were at one point.”

“The supply chain disruptions are hitting retailers large and small,” says Jon Gold, NRF's vice president of supply chain and customs policy. “Retailers are working to ensure there will be products available for the all-important holiday season. However, consumers should be prepared to shop early and safely to ensure they get what’s on their holiday lists.”

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