Speed Reads

the supply chain crisis

A shortage of shipping containers has companies rethinking 'how they stock shelves'

As the supply chain crisis continues to plague businesses and consumers around the world, the mundane shipping container — once an "ordinary cog" in the supply chain machine — has become a "coveted and expensive lifeline for the nation's retailers and manufacturers," reports The Washington Post.

An abysmal supply of boxes with which to shuttle goods from here to there has companies rethinking "how they stock shelves, placing a premium on smaller, more compact merchandise," such as "squishy" toys and headphones, rather than "televisions and hiking boots," per the Post

To further maximize "every cubic inch of these boxes," some retailers are even shrinking toy packages by 30 percent.

"Call it the Jenga supply chain," Suketu Gandhi of consulting firm Kearney told the Post. "Without shipping containers, the whole thing tumbles."

Economists say the shortage is a "byproduct of the pandemic," explains the Post. As COVID-19 shutdowns "disrupted the global movement of freight while boosting demand for consumer goods," ports and warehouses ran short on workers to unload containers as well as truck drivers to transport them. That's left an estimated 3 million containers stranded around the world.

To circumvent the issue, some retailers, like Ikea, have begun acquiring their own boxes. Those like Walmart, Target, and Home Depot are chartering their own ships to avoid delays. And for other companies, what goes inside each precious container becomes a "a carefully choreographed calculation of a product's size, demand and cost," writes the Post.

"We're packing containers with products that we know are going to sell," said Nora O'Leary, president of speciality toymaker Manhattan Toy Co. "When freight costs six or seven times what it did a year ago, you can't take risks on new designs."