Small US businesses face major setbacks amid rising prices and lack of deliveries

To find out how to make and deliver his bikes, Wayne Sosin of Worksman Cycles claims to have tried everything since the beginning of the cycle. pandemic.

He searched in vain for a container to ship cargo to Saudi Arabia for six weeks. Not to mention the tire supplier, who will have to wait a year. Or the price of moving a container from Asia to USA, which went from about $ 6,000 to $ 25,000 or $ 30,000.

“It really isn’t easy,” the 60-year-old says of this New York-based company that has made a name for itself with its ruggedized tricycles.

Between factory closures due to spikes in infections, an explosion in demand for certain products such as bicycles and computers, the lack of personnel in warehouses or trucking, the COVID-19 it has disrupted the world economy.

And many companies are struggling to find supplies.

A multinational like Nike has warned that some of its sports footwear and apparel products may be temporarily unavailable.

To make sure the shelves are well stocked as the holidays approach, the supermarket giant Walmart chartered its own boats.

For those responsible for small companies, the logistical challenges are minor but also a headache.

136% higher turnover

Jack Hillman is a manager at Hall-Woolford, a ten-person company in Philadelphia that has been making wooden water tanks since 1854.

At the beginning of the year he had to juggle rising lumber prices in the United States, but then they began to decline.

Now you must deal with the iron you use to attach the tanks. Orders typically take eight weeks, but the last one took more than five months. “And when the truck arrived, it wasn’t even full, but we had to pay full price. We have no choice. “

Your suppliers no longer bother to quote a price. For his last order of white pine planks, he had to search for three months and when he managed to get a package, “the price was 136% higher than the previous order,” he recalls.

For fear of running out of wood, he recently ordered twice as much as he needed. Hall-Woolford never stopped producing, but was forced to pass on the additional costs to customers.

Worksman Cycles, which employs 45 people in New York and a plant in South Carolina, can’t afford to raise the price of its bikes too much and has so far assumed most of the cost overruns.

Wayne Sosin expects supply problems to persist into 2022. But the situation may eventually resolve itself as he anticipates a drop in demand for non-electric bicycles.

Inventory depleted

Mike, manager of the Sohi Performance auto parts store, stopped calling customers to warn them of a backlog of their orders and to give them a new date. “We changed the site to simply say: this article is out of stock, we will send it when it is available,” explains the head of this Californian company, who asked not to be identified.

Usually only 1% to 2% of orders are late. “Currently around 97%,” he acknowledged.

The problems started a year ago. And all brands are affected, whether they are made in Asia, Sweden or the United States. The turnover of his company, which he co-manages with his partner, was cut in half.

“We work in commerce, we know that business fluctuates over the years,” he says. His suppliers told him four months ago that the situation was improving. But “day by day, I continue to handle hundreds of overdue orders.”