Retailers are gearing up for busy Black Friday sales, while PriceSpy reveals the top tips to make sure you get the best deal. Video / NZ Herald
Black Friday sales, Christmas shopping, DIY jobs and renovations could be at risk as global shipping delays intensify - with significant price hikes also predicted.
Issues plaguing shipping during the pandemic have resulted in fewer container ships visiting the ports of Tauranga and Auckland.
Freight costs have escalated by 300per cent, with some desperate businesses back-ordering stock that could take months or years to arrive.
Retail NZ said the delays were affecting almost everything including electronics, clothing, power tools, books, gym equipment and games. Two-thirds of its members were hiking prices by 7.5 per cent over the next three months to cover costs.
Tauranga Chamber of Commerce chief executive Matt Cowley. Photo / NZME
Tauranga Chamber of Commerce chief executive Matt Cowley said the lead-up to Christmas was the biggest period for retailers and a supply chain bottleneck ''especially after this lockdown period, will hinder the nation's economic recovery''.
He said many businesses relied on that revenue to survive.
"Retailers are wondering about the upcoming sale season, with supply chain backlogs potentially impacting Black Friday sales and the lead up to Christmas.''
There were direct costs the business and consumer equally share – and someone ultimately needs to pay.
''There are also opportunity costs of lost sales where customers are prioritising not only price but also the speed of delivery times. The lead-up to Christmas is the biggest period for retailers that keep many running for the rest of the year, particularly during the quieter winter months.''
Retail NZ chief executive Greg Harford said freight costs had jumped by 200 to 300 per cent over the past 18 months and had put further pressure on margins.
A Retail Radar survey of its members suggested two-thirds expected their prices to go up by about 7.5 per cent over the next three months.
''Across the board, there are delays getting product shipped and into the country, and the costs of both freight and the products themselves are increasing.''
Harford was urging customers to plan ahead for the Christmas and New Year purchases and be aware that there could be shortages.
''If customers can't get exactly the products they are looking for, they could look for something similar, or talk to their retailer about back ordering it.''
There were delays with almost everything and retailers were doing their best to plug the gaps with alternative products or brands, and by air freighting goods in.
Rotorua Chamber of Commerce chief executive Bryce Heard said it was well aware of the stockout issues related to supply chain slowness and increased demand for some lines since the advent of Covid and lockdowns.
''Shipping and freight rates are notoriously volatile and for a country at the bottom of the Pacific Ocean this has potentially severe ramifications.''
Burnard International Tauranga branch manager Kevin Woledge said shipping lines had consolidated over past years and realigned their services, which led to shortages of space on their vessels.
Covid caused factory closures and importers struggled for stock but there has been unprecedented demand since the bounce back, which has continued globally.
Woledge said the charter price of vessels has doubled with rates expected to hold this year.
''Trying to balance service versus price options for our customers where rates are extremely high and options are limited.''
All import and export services were experiencing some form of delay.
''Asia and particularly Southeast Asia there are significant delays at the large transhipment ports. Services across the US and Europe have all been reduced to avoid lengthy vessel delays.
''Port rotation and cancellations are commonplace further adding to increased transit times.''
Plumbing World chief executive Robb Kidd said in his view shipping companies were directing some of their ships to bigger countries like America or Europe where they could send five or 10,000 containers.
Congestion at the ports and a rail to road system that wasn't geared up to offset that was causing big problems.
Kidd was also aware of two companies that spent $1 million on airfreight last Christmas to get goods in on time for the silly season.
Master Plumbers, Gasfitters and Drainlayers NZ chief executive Greg Wallace said the cost of shipping was horrendous.
''A container that used to cost $1000 is now close to $5000. The issue is that there is a construction boom worldwide not only in New Zealand. And because we are a very small market and we are the furthest away, suppliers are telling me they will secure a container through a freight company.
''Then it's like an auction so you could lose that container or that space because it is more effective for that freight partner to go to Perth or somewhere in Asia.''
Wallace said New Zealand did not have the import or export volumes compared to other countries.
The Port of Tauranga said in its end-of-year financial report that imports increased 4 per cent to 9.4 million tonnes and container volumes decreased 4.1 per cent to 1,200,831 20ft equivalent units (TEUs).
There were 502 container vessel visits between September 2020 and June, 106 fewer than the year before.
However, average cargo exchange increased 21.7 per cent because of the reduced vessel frequency and shippers maximising available capacity.
A Port of Tauranga spokeswoman said shipping schedules were still disrupted and many vessels are arriving "off window".
''They may have to wait at anchor for a couple of days until they can be processed. There have not been significant delays land-side since KiwiRail increased our train programme in May.
''There is ongoing disruption and congestion in ports around the world and shipping capacity remains constrained.''
Ports of Auckland spokesman Matt Ball said all of its were cranes were working but not all at once.
''There are no ships at anchor, no delays at Ports of Auckland. We have cleared the congestion that was being experienced late last year and at the start of this year.
''It is simply not true to say that there are big delays at POAL and that there are bottlenecks, even under Level 4 lockdown.''
The number of ships visiting was also down this financial year compared to last but the exact figures were not available.
