The well-publicised re-routing of container ships to avoid the Red Sea and Suez Canal route for safety reasons will undoubtedly have an impact on the delivery of supplies into the UK, and the inevitable knock-on of this may be limited or delayed availability as the season unfolds.

One freight forwarder was recently quoted as saying: “The recent attacks in the Red Sea have led to a significant change in maritime practices.  With vessels still rerouting their paths around Africa, the new route adjustment will likely become the new normal in the shipping industry.” This change looks to be permanent for the time being, but the initial shock wave is certainly at the wrong time for our industry. Couple this with the timing as we hurtle towards an early Easter and, with that, Chinese New Year on Feb 10th, where factories close down for the celebrations, and we may see the overall issue compounded significantly if orders have not yet been placed. And there we were, thinking things were getting back to a semblance of ‘normal’.

Despite having been in a similar position before, we still have to ask what the implications might be because of these latest developments. For products that are best associated with the earlier part of the season, we expect most suppliers to be well stocked and ready for pre-season, so we anticipate the delays impacting those top-up orders later in the season.  What’s more, it’s unlikely that the issue will solely affect Far East finished goods. Those manufacturing here in the UK or closer to home will still probably be impacted by the availability of raw materials and components.  

Suppliers are reporting container delivery dates being bumped regularly plus freight companies are adding distance surcharges and emergency protection guarantee fees, equating to around a 30% increase in costs. The decision as to whether to pass on these costs will depend on several factors, including the type of products and categories impacted, the suppliers themselves, and whether the market can accept the rise. Recognising that margins are already tight for everyone this year, we have no doubt that conversations around this subject may be challenging. Our advice remains the same – keep your communication channels open. Don’t hide away and hope it will all sort itself out; instead, look at the data, understand how it will impact cost and supply in both the short- and medium-term and report this back to customers as soon as possible. From here, you have the time to find a solution agreeable to both parties and perhaps it won’t be necessary should the pressure be alleviated sooner than anticipated. As the saying goes: “There’s no harm in hoping for the best as long as you’re prepared for the worst.”

For the retailers reading this, may I offer a straightforward plea – ensure you’ve secured your orders. If you leave it too late, suppliers will not necessarily be able to guarantee stock availability when you want it.  This is particularly true of those high-ticket items such as garden furniture, with their slightly later selling season.  I’m sensing a more just-in-time ordering strategy from retailers this year with their stock builds in these categories, expecting suppliers to take all the risk.  It’s understandable, considering some of the overstocks experienced in the last couple of years, but I would urge anyone taking this approach, to think again.  Help your suppliers to forecast sufficient stocks by confirming your orders sooner rather than later.

All that said, we remain optimistic as we enter season 24. With a blank sheet before us, it is now time to write the story of the year ahead. We know as an industry we can tackle challenges, but here’s to hoping that what we are currently faced with is the pinnacle of our concerns this year.

Find out more

Any businesses interested in joining GIMA are invited to contact the GIMA team on (01959) 564947 or info@gima.org.uk. Full details regarding GIMA’s multiple member benefits can be found at www.gima.org.uk