The Impacts of COVID-19 on Supply Chain Issues and the Packaging Industry
It’s hard to understate the influence of COVID-19 on supply chain-oriented businesses. Though we’re well into 2022, the impact of COVID on supply chain problems persists throughout several global industries. While more commonly known issues such as chip shortages made headlines, glass shortages affected packaging companies, retailers, e-commerce brands, and other diverse markets.
The supply chain disruptions due to COVID range from limited packaging materials to slower fulfillment speeds, which means it takes longer for your customers to receive their products. Understanding how these COVID supply chain problems impact you can help you adapt and resume steady operations that help your business thrive.
Limited Packaging Materials
Due to the effects of COVID-19, the impact of severe weather throughout the United States, and ongoing materials shortages, many manufacturers have either reduced operations or paused outright. With less access to much-needed packaging materials, some businesses are stuck with excess inventory they cannot ship. The best way to mitigate that is to use different materials or collaborate with different suppliers.
High Expenses for Raw Materials
Raw material costs continue to fluctuate, another impact of COVID-19 on supply chain operations. Coupled with ever-increasing demand across many markets, you have a supply chain crisis primed to pass on those added costs and expectations.
The cost of packaging materials has increased dramatically, meaning that specific bottling and packaging solutions may not be as viable as they once were. Even when you swap your materials, rely on different suppliers, and reach out to your broader network, you may have to hold out for specific materials as the market is mismatched due to supply chain COVID-19 hiccups.
Slower Fulfillment Speeds
In many cases, your customers are more likely to see slower shipping speeds, delayed deliveries, and fulfillment difficulties. When you pair this with a national trucker shortage, it’s easier to see why getting your products into your customers’ hands is more complicated than ever. However, when you invest in high-quality packaging, limited-edition designs, or influential labels that bolster your brand, you can offset some of the frustrations of delayed fulfillment.
Frequent Over-Ordering
One of the many supply chain challenges during COVID is over-ordering products. While it’s reasonable to assume this regularly occurs on the consumer’s end, retailers, manufacturers, and consumers alike are ordering raw materials and finished goods excessively.
This happens when people buy excess products, containers, and packaging materials to preempt inflation or availability issues. While it might seem sensible from a business standpoint, you must distinguish between an in-demand product and a reactionary shortage before overspending on products or materials. Order enough, so you have room to grow, but don’t order so much that you’re sitting on the unmovable stock.
Labor Shortages
Alongside the supply chain shortages due to COVID, there is a severe labor shortage in the United States. This is due to several factors, including the aging population, the decreasing birth rate, and the increasing number of people choosing to work in other countries. The labor shortage is particularly severe in the manufacturing and construction industries.
This shortage is causing several problems for businesses and workers. Companies are finding it challenging to find qualified workers and are having to offer higher wages and better benefits to attract them. Workers are finding it difficult to find jobs that pay a living wage, and many are having to work multiple jobs to make ends meet. These factors directly inform the supply chain issues COVID presents to industries worldwide.
Logistics Complications
Lockdowns, border closures, and community restraints prevail in several global markets. This can directly increase your supply chain expenditures and impact where you can source products, materials, and packaging supplies. One way to adapt to logistics complications is to switch up your packaging materials, work with new suppliers, or forge new partnerships within your industry.
Out of all the COVID supply chain disruption examples, this may be one of the hardest to predict since it varies by locale. In addition, different markets have rules and regulations that they’ll follow when they reopen trade routes and reestablish commerce. Couple that with international troubles, and it’s clear that the supply chain challenges during COVID are vast and numerous.
Force Majeure Clauses
Particularly in Europe, the COVID supply chain problems have caused a swath of “force majeure” clauses since raw materials suppliers can’t deliver goods to businesses that cannot distribute products to consumers or other companies. So, naturally, these clauses then cause problems that continue to impact brands well in the future.
If you’re trying to navigate this difficulty, you should partner with local suppliers when possible. Working with a local manufacturer can reduce the likelihood of a failure to deliver. In addition, hiring a local supplier can help you avoid importation problems that could hamper your sales.
Lack of an Equitable Playing Field
Beyond the supply chain problems COVID provides, there are other complications. When it comes down to it, large retailers, big-box stores, and global brands have access to resources and opportunities that smaller and mid-size businesses don’t.
Luckily, plenty of packaging suppliers like BottleStore.com don’t make you choose between quality and affordability. From glass bottles to recyclable plastic containers, sustainable packaging helps to empower your brand, attract customers, and build your reputation.
Suppose you’re ready to learn more about the impact of COVID-19 on supply chain operations and how to find quality packaging materials that don’t let you down; contact. Our packaging and shipping experts understand that your customers rely on timely deliveries and high-quality bottles. We’re here to help you find the ideal containers and closures while helping you understand core strategies to circumnavigate supply chain challenges during COVID.
