Shortages & The Failure of the Supply Chain

Rambo

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There is shooting yourself in the foot to toast your own retail high season for Christmas and then there is shooting yourself in two feet telling customers you might not even see what you order for next year's holiday shopping season.
How do you see that as them shooting themselves in the foot?
 

Rambo

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I thought this was well known. It's been well reported, for a change.
“But with the government strictly controlling electricity prices, coal-fired power plants are unwilling to operate at a loss, with many drastically reducing their output instead.”

How very communist of them…
 

formby002

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“But with the government strictly controlling electricity prices, coal-fired power plants are unwilling to operate at a loss, with many drastically reducing their output instead.”

How very communist of them…
Well, China does operate a kind of hybrid state/capitalist model.
 

Rambo

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Well, China does operate a kind of hybrid state/capitalist model.
Yes formby I was being facetious for all of our right wing china hawks that think their communist system is the devil
 

Pimpernel Smith

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No shortages here. Petrol is up at the pump mind you, but I don't see any food inflation.

But the Dutch are strategically placed for just-in-time delivery, trading and logistics on into Europe. You also have the green house food industry, which is second only to the USA for exports. If there were shortages here, I would be worried.
 

fxh

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No significant shortages here - of basics

Some building materials that rely on imports - like small bolts that hold High Rise Buildings together and stop all work if they aren't available - New cars are in very very short supply which has made second hand cars shoot up in value - And a few electronic goods - like latest models TV - y'know the ones bigger than a movie screen - not that that causes much pain

There is a whole reassessment of JIT. A lot of building built in the last 10 - 15 years have basically no storage and rely on JIT delivered directly to the user space, then the warehouses behind that in the chain worked on JIT, then shipping, and factories in China, India and third world countries with cheap labour like USA.

Plus its not like we are close to all the manufacturing - although thinking about it we are close ish to India nd China - but we are a small market 25M+ - so if you are going to send a few ships out with your (limited) products then UK, EU and USA make more sense.

Plus with cars we are right hand drive - and different preferences to EU/UK/Japan - so factories have to change tools.
 

Fwiffo

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How do you see that as them shooting themselves in the foot?

Without cash flow, you go under.

As a corporation that sells things to people to tell people you have nothing to sell, or they will be late (so late look us up next year or longer), or prices will go up when goods arrive - are all elements of a circular death spiral.

Better to say we're trying to procure everything you want - put money down to get your spot in the queue. Or rather, the more money people put down, the easier it is to wave money at the logistical shipping firms to get going.
 

Pimpernel Smith

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you mean the manufacturing philosophy that's failing the world over? great news that the dutch are so good at it!
Just-in-time has it's risks of course. What's failing is a deeper rot and the in hindsight bad decisions to close down the global economy.
 

formby002

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Just-in-time has it's risks of course. What's failing is a deeper rot and the in hindsight bad decisions to close down the global economy.
JIT may be suitable for building cars(debatable) it isn't however suitable for running a country where there is a need for a degree of resilience.
 

Pimpernel Smith

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JIT may be suitable for building cars(debatable) it isn't however suitable for running a country where there is a need for a degree of resilience.
I mean specifically for certain consumables and products. You don't need warehouses for televisions, etc.

Strategic resources, you need a safety cushion and access to reserves. That includes energy and even foodstuff e.g. grain stores.

Don't think there will be food shortages, or a famine in Europe or the UK, but the probability of black-outs over the winter seems probable. That will be the end of Boris it will also focus minds on fantasy and reality when it comes to the feasibility of certain intermittent renewables.
 

formby002

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I mean specifically for certain consumables and products. You don't need warehouses for televisions, etc.

Strategic resources, you need a safety cushion and access to reserves. That includes energy and even foodstuff e.g. grain stores.

Don't think there will be food shortages, or a famine in Europe or the UK, but the probability of black-outs over the winter seems probable. That will be the end of Boris it will also focus minds on fantasy and reality when it comes to the feasibility of certain intermittent renewables.
I'm hoping there'll be a turn to nuclear, but we need to demonstrate to the public that we can handle the shit they produce, that we already have.
 

Rambo

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I mean specifically for certain consumables and products. You don't need warehouses for televisions, etc.

Strategic resources, you need a safety cushion and access to reserves. That includes energy and even foodstuff e.g. grain stores.

Don't think there will be food shortages, or a famine in Europe or the UK, but the probability of black-outs over the winter seems probable. That will be the end of Boris it will also focus minds on fantasy and reality when it comes to the feasibility of certain intermittent renewables.
yes, you do need warehouses for televisions and other assorted electronics, when all of your replacement parts and new models are stuck on a fucking boat in the middle of the ocean and you can't get them to customers. or you can't build them because all the workers at your plant are sick so you had to shut the fucking thing down.
 

fxh

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The pandemic - and the Evergreen stuck in Suez - have given us all a jolt - its clear with JIT there's no Surge Capacity. Anywhere in the chain.

Now for some things it doesn't matter much - WGAF if someone cant get a brand new car the day they want it - but if you all of a sudden want surge in disposables like PPE and thousands a day instead of 2 or 3 a day - you need warehouses and onsite storage adjacent to usage - we ain't got that - nobody has due to JIT.

There has to be a lot of rebuilding - a few hastily plonked shipping containers in the car park wont cut it.
 

Arnathor

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I work at dealerships, currently there are no cars in one of the show-rooms, lol.

New arrivals will trickle in and things should look better by next summer.
 

güero

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Bild


But now that can at least wait 24 hours for free!
 

Pimpernel Smith

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The increase in shipping costs is significant between China and US, I assume a similar increase between the Far East and Europe. That will all work it's way down to the consumer's pocket.

A modern docks dealing with containers must be able off-load a container ship in next to no time. I can't see any difficulty in finding labour for that either. It's not a hard grueling job is it? It's an overhead crane and away you go. You have limitations of the docks itself and the infrastructure. Also if the lorry drivers aren't there. But I can't see it being a long terms structural problem.
 

Pimpernel Smith

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There's certainly no shortage of Beefeater gin here. Was on offer at €11.95 a bottle. Good to see some essentials getting through.

Went to the expat supermarket at the weekend, the moratorium on pork pies remains in place. They also have a problem with getting stuff from the States, they've a delivery that's now held in customs and is two months late with no end in sight.
 

Pimpernel Smith

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I'm aware of a number of companies who are renegotiating contracts on the basis of several fold increases in shipping costs of raw materials from the Far East.
 

fxh

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I’m told all containers costs have about doubled on anything
 

Pimpernel Smith

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The pandemic - and the Evergreen stuck in Suez - have given us all a jolt - its clear with JIT there's no Surge Capacity. Anywhere in the chain.

Now for some things it doesn't matter much - WGAF if someone cant get a brand new car the day they want it - but if you all of a sudden want surge in disposables like PPE and thousands a day instead of 2 or 3 a day - you need warehouses and onsite storage adjacent to usage - we ain't got that - nobody has due to JIT.

There has to be a lot of rebuilding - a few hastily plonked shipping containers in the car park wont cut it.
The problem is, having large storage capacity costs. The Dutch have or had pretty much mastered JIT principles.

I'm not noticing any food inflation, or shortages here, petrol at the pump has gone up a bit. Nothing noticeable. My American colleagues say they have noticeable inflation.
 

Rambo

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The problem is, having large storage capacity costs. The Dutch have or had pretty much mastered JIT principles.

I'm not noticing any food inflation, or shortages here, petrol at the pump has gone up a bit. Nothing noticeable. My American colleagues say they have noticeable inflation.
Yes we have
 
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