The Punches Keep Coming

Last week, virtually every vendor we have sent us notices that they are expecting shortages of critical chemicals due to the recent weather challenges in Texas.  We are being put on allocation for several products.  These allocations are optimistically expected to last 4 weeks, realistically last 8 weeks, and pessimistically last at least 12 weeks.

  As I have written in the past, it does not take a PhD in economics to understand when demand exceeds supply, prices go up.  Get ready.  As I have also written in the past, price becomes less important when you cannot get products.  Get forecasts.  Plan.  Please.  For the love of God, please plan.  Carrying extra inventory in challenging times is not a bad thing.  You do not need to hoard, but I do suggest you keep a safety stock.  Fire your just in time inventory expert.

A wise industry buddy of mine remarked to me, “2020/covid is like a soccer game.  They keep adding extra time.  As a fan, you never know when the game will end.  That’s how this feels.”  Extra time is a concept Americans do not understand.  In our sports, overtime has set time limits.  We all hoped the challenges of 2020 would pass with the calendar change.  That has not happened.  Yet.  Good times are ahead for those that survive our latest challenge.

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