‘We don’t see it actually improving’ for months, luxury brand CEO says [Video]
A reduction in the backlog of container ships awaiting access to the ports of Los Angeles and Long Beach in California in early 2022 offered hope that supply chain disruptions would sort themselves out sooner rather than later.
That hope is fading.
The optimism was palpable exactly one month ago. Seventy-eight container vessels were waiting to offload goods at the two West Coast ports, a significantly lower number than the peak of 109 vessels waiting for entry in January.
“In terms of the inventory flow, this supply chain situation is going to continue on for at least the next six months,” Capri Holdings (CPRI) CEO John Idol said on the global fashion luxury company’s most recent earnings call. “We don’t see it actually improving. Many of the ports are quite backed up.”
‘Everything is going to go through the roof’
Many U.S. retailers are still waiting for deliveries of spring/summer merchandise, including shorts, sandals and other gear to arrive.
According to the Wall Street Journal, nearly half of the spring line that New York clothing chain Untuckit planned to feature in its March catalog hasn’t yet arrived from Vietnam. Meanwhile, Macy’s (M) is facing shortages of women’s shoes, handbags, and toys, according to its CEO.
America’s trucker shortage is also an issue, meaning that it’s taking longer to get goods from the port to their distribution centers, creating a whole new layer thrown into the supply conundrum.
Supply chain issues created by the pandemic are now exacerbated by global supply chain woes tied to the war in Ukraine. Energy prices are soaring around the world due to the country’s conflict with Russia, a major source of oil for various parts of the world.
“This whole supply chain is obviously going to have an inflationary impact on the U.S. economy, but globally, oh my gosh,” Kona Haque, ED&F Man head of research, said on Yahoo Finance Live recently. “It’s freight, it’s the cost of shipping — everything is going to go through the roof.”
Karina is a reporter for Yahoo Finance.
Follow Yahoo Finance on Twitter, Facebook, Instagram, Flipboard, LinkedIn, and YouTube
