The Current Situation in the Asia Pacific Trade
As Chinese factories roared back to life following the Covid lockdowns of 2020, coal consumption within the country skyrocketed. This spike in consumption led to power shortages and government rationing and has negatively impacted the supply chain throughout 2021. Energy shortages have led to factory closings, production delays and choked the flow of imports from Chinese ports.
In addition, many US warehouses are at near full capacity, making it more challenging to move products through the domestic leg of the supply chain. The issues in China and the US have led to shipping delays leading up to the current holiday season.
What the Arrival of the Chinese New Year Means to You
As an importer, it’s essential to understand how the culture of your source country or region can affect your supply chain. Every year, the Chinese New Year (CNY) holidays significantly impact the Asia to US trade lane, and if you source from China, your company’s supply chain.
The CNY holiday, also called the Lunar New Year, traditionally lasts for 16 days. In 2022, CNY is officially celebrated during the two weeks between January 31 and February 15. Unofficially, the celebrations can last up to a month, and with travel time, workers may be away from their jobs for a month or more.
Understanding the Culture and the CNY Effect
Many new importers, particularly the small businesses working through the Amazon platform, are caught off guard by the CNY effect. Lacking knowledge of this annual event’s impact on the supply chain can lead to overpromising and underdelivering.
It’s important to realize that many workers start their leave several days before the holiday begins and that production may halt by the end of January. Many workers will return a few days after the holiday ends, extending labor shortages and production delays.
After the holiday, factories can take up to a month to ramp up, and the rush to meet their customers’ demands can lead to quality issues. The CNY effect predictably constrains the flow of goods throughout the first quarter of every year.
As an importer sourcing a significant amount of inventory from China, it’s essential that you plan ahead. The experienced professionals at Dedola Global Logistics will keep you informed, align your projections, and help you efficiently avoid predictable issues. We’ve navigated 45 years of Chinese New Year holidays, helping our clients thrive during this challenging time.
How Dedola Can Help You Optimize Your Supply Chain
At Dedola Global Logistics, we’ve successfully secured space and equipment for our clients throughout the Covid crisis. DGL clients have benefitted from our long history of navigating supply chain challenges. Our presence in China, established network, and industry insights help our clients align their purchasing process, getting out ahead of both novel and predictable events.
An Experienced Global Logistics Company on Your Side
Dedola has provided our importer customers with reliable logistics services, ocean, air, rail, and trucking through 45 Chinese New Year seasons. We know what to do when challenging situations arise and are ready with solutions for our clients.
We offer best-in-class online tracking and unparalleled industry experience. Book a series of trial shipments with us today and experience the Dedola difference! Contact us today or call (562) 594-8988.