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What Is Causing Product Shortages and Increased Lead Times?

What Is Causing Product Shortages and Increased Lead Times?

In the midst of the recent pandemic and fallout from Brexit, many businesses and consumers are facing product shortages and delayed and inflated shipping rates; as such we want to address the benefits of reshoring to the UK. Reshoring is the process of returning production and manufacturing of goods back to the businesses original country. This process would in turn provide an array of benefits to the business and its wider community, notably that of reduced shipping costs, reduced lead times and reduces local unemployment rates.

Recent events have created unprecedented times and a perfect storm for product shortages and increased shipping costs, this is primarily due to three key factors.


The first being unprecedented demand, the previous year has seen increased volatility with a sharp drop in demand in early 2020, followed by extreme sustained and ongoing demand from the second half of 2020. Paired with the disruptive demand created by the biggest increase in demand for recreational goods and electronics from Asia to the U.S and Europe, the problem of too many products and not enough containers has been exacerbated.


Secondly, congestion on land has led to further issues. Ports have become increasingly congested with the increased number of vessels, cargo and empty containers that cannot be transported due to reduced capacity, brought about by COVID-19 protective measures and employees in quarantine.


Whilst the third factor is that of a container shortage, primarily caused by container production being halved in 2020 as a result of COVID-19 impacts, resulting in production not matching demand. Many containers are also trapped in ports, due to a shortage of lorries and drivers to transport the containers as a result of isolation protocols.

Resultantly, container prices have increased by approximately 400% since before the pandemic, leaving many businesses unable to finance a container to ship their products. Furthering this issue, even for those businesses that have the financial means to book the container, there is no guarantee that a container will be available.


In order to overcome this issue, many businesses have begun to implement processes that reduce lead times and product shortages to retain customers and sales. One method being reshoring. Through producing in the UK, businesses are able to avoid the risk of having finished products stuck half way across the globe. Additionally, through enacting UK production businesses will be actively supporting their local communities, with the reduction in shipping costs offsetting potentially increased labour costs.

Here at Blake we have enacted a stockholding model that allows us to have reduced delivery times, meaning our customers are still able to receive orders within the next working day (if ordered before 3pm).


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