Nearly every industry has been experiencing shortages in materials and staffing, as well as delays and longer timeframes for consumer goods. A common theme across all industries is the impact of COVID on supply chain. During the worldwide shutdown, a demand for products subsided and production slowed down. Now that the economy has slowly opened back up, product demand spiked and supply chain has not been able to catch up.

It’s not just our industry; this is a problem that’s truly global,” said Joe Hoffmann, vice president of vendor management at iPROMOTEu. As we navigate these supply chain challenges, we identify current and future trends, the impacts on promotional products, and how affiliates can better serve their clients and customers.

Current Promotional Product Supply Chain Trends

As the global economy shut down in 2020, there was a ripple effect on consumer products. From manufacturing and production to shipping and logistics, every aspect of the supply chain has been affected.

“It does hit on all areas of the supply chain, there’s not one factor alone. It literally hits on everything including availability of raw materials, overseas factories, transporting product from overseas to the U.S., and transporting within the U.S.,” said Hoffmann. “Our products are mostly decorated here in the U.S. and staffing in domestic factories has been an issue as well.”

In addition, labor is also limited with staffing shortages across the globe. According to CNN Business, many workers that were sent home during the pandemic still haven’t returned which has led to slower production and stalling projects.

Alleviating these supply chain challenges has been slow. Arriving at relative normalcy is predicted to occur over time, possibly into 2022. The overall trend from suppliers is trying to increase production as they recover from backlogged work.

“There’s all this pent-up demand and even if everything was running as it was before COVID, we’d still have excess demand and difficulty in satisfying it. There’s a big imbalance between this demand and what the global marketplace can supply right now,” said Hoffmann.

Impact on Promo Products

While suppliers and affiliates managed demand spikes in late summer/early fall and the back-to-school season, inventory holes will persist longer than expected, specifically apparel, into 2022. As product demand increases for the upcoming holidays, there needs to be preparation for these delays and setbacks when delivering on client orders.

Hoffman said, “The difficulty that the global supply chain has is catching up with demand. We essentially turned off the supply chain for a number of months and restarting it just takes time.”

With the shutdown, virtual conferences and the shift to work-from-home also drove a change in product deliveries from offices and conferences to residences. In the past, a few large shipments would be sent to conferences for booth preparation. Now, a few hundred shipments are being sent to individual homes, putting an extra strain on carriers such as FedEx, UPS, and USPS.

“Their logistics model wasn’t built for that balance of fulfillment. That phenomenon we were hoping for would ease the strain of the carriers, but it has not to the degree that we had hoped,” said Hoffmann. These additional obstacles need to be taken into consideration when communicating next steps with clients and suppliers.

What Promotional Product Distributors Can Do

Because of these supply chain challenges, promotional product distributors should take extra precaution and preparation to ensure their clients are in good hands.

“In the past, turnaround was relatively dependable and understandable from our supplier base. If you placed an order and knew that your customer didn’t need something for a week or two, you’d feel confident that it would get there in a reasonable period of time,” said Hoffmann. “Now, that’s out the window.”

Especially for the upcoming holiday season, these tips will help you and your clients remain successful.

  • Prepare your clients – encourage open dialogue and set realistic expectations on orders and product availability
  • Seek other vendors – to accomplish your clients’ needs, reach out to other vendors and suppliers for additional fulfillment
  • Order early – the sooner you can order, the better your chance for success
  • Create backup plans – to avoid unavailable product or longer delays, strategize other opportunities to fulfill your clients’ orders
  • Submit complete orders with in-hand date – with recent slower turnaround times, make sure orders are filled out with all the necessary information, including the date product is needed, so suppliers have everything they need up-front

 

Rise Above Your Competition

iPROMOTEu provides valuable resources and top-notch support services to take your non-revenue-generating tasks off your plate, allowing your company to focus on selling products, building new relationships, and growing your current customer portfolio, all while combating these supply chain challenges.

If you’re a promotional product distributor struggling with today’s supply chain challenges, we’re here to help. Connect with iPROMOTEu today to learn more or become an affiliate.

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