The best way to describe what’s happening right now is that Supply chains have taken a laxative. That is, the supply chain bottlenecks that have troubled the global economy for more than a year are slowly but steadily easing—or at the very least being avoided.
This week, the country’s leading retailers said in unity that supply chain snafus will not be the Grinch this holiday shopping season.
“We are in a good inventory position” ahead of the holidays, according to the CEO of TJX, the parent company of TJ Maxx and HomeGoods.
Last quarter, Target’s inventory increased by 17.6%. It claims that because of its inventory and staffing investments, “we will be there” when you come in to buy that TV.
Remember how the auto sector was crippled by a global semiconductor shortage? It’s possible that it’s reached its apogee.
The week of Nov. 1 marked the first time since February that none of GM’s North American assembly factories were shut down due to a shortage of chips, according to the company.
For the first time in seven months, Toyota’s production lines in Japan will resume normal operations in December.
Finally, let us discuss shipping.
The 80 cargo ships waiting to offload their goods at LA ports would be the best visible representation of the supply chain problem. However, that traffic bottleneck appears to be moving from “bumper to bumper” to “slow crawl.”
Because to a new levy on loitering containers, the number of import containers at the Port of Los Angeles has decreased by 25% since last month.
Meanwhile, the Baltic Dry Index (BDI), a measure of worldwide shipping costs and an inflation predictor, has fallen by half since high on Oct. 7, providing yet another encouraging sign for consumers.
Looking ahead, with Covid sticking around and global labour shortages, bottlenecks could be an annoyance for a long time. However, the nightmare scenario of empty store shelves on December 20 is unlikely to happen.