Brand Focus Digital recently reported as to how supply chain disruptions continue to haunt the U.S. Economy. It seems as if things have only gotten worse. How are big retailers responding? Well, sometimes you just have to take matters in your own hands.
According to the Wall Street Journal, the supply chain is officially “broken.” Some of the biggest retailers in the U.S. have responded by chartering their own cargo ships to import goods. Examples of these retailers include:
Some of these retailers are passing along the added import-related costs onto consumers in the form of higher prices.
The retailers are using smaller ships than traditional cargo vessels. The small ships can only hold about 1,000 containers. This is in contrast to 20,000 containers that larger vessels can carry. The smaller ships are about twice as expensive to operate in comparison to their larger counterparts.
The good news is that the retailers can now work around bottlenecks at busy ports like Los Angeles. With smaller ships, they can reroute their goods to other docks like those in Portland and Oakland. As a result, they can take it upon themselves to ensure their goods are available for holiday shoppers.
Although expensive, the new tactic could result in a creative solution to a very real problem. A concern, though, is how this new move will impact smaller retailers. As the Journal podcast suggests, small retailers may have to increase their prices because of reduced supply. But consumers then could choose larger merchants for their shopping needs, and smaller operations resultingly suffer a hit in profits. As always, we’ll continue to monitor this situation and report back with updates.
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