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Stores will run out of items faster than ever this holiday season: Here’s how to beat shortages, supply chain issues

How can you beat the holiday shopping nightmare that will unfold over the next three months as supply chain issues take center stage with retailers?

For months the U.S. economy has been crippled by shortages and supply chain issues. Even shortages of workers has been problematic for companies as they try to keep up with demand. As fall arrives and Americans begin thinking about the holiday shopping season – a new warning has been issued: Don’t wait to make holiday purchases, because inventory will be limited.

Zippers, glass, automobile parts, computer chips, and common items found at grocery stores have been impacted by production shortages and supply chain issues. The shortages have even forced some schools across the U.S. to completely reimagine basics like breakfast and lunch – as items run out, or are unavailable for an extended period of time from suppliers.

Retail executives are very concerned about inventory heading into the holiday shopping season. According to a survey by KPMG, 55% of retail executives have plans for alternate suppliers to meet demand and inventory squeeze, while 82% of those surveyed said there was concern on the horizon.

“I can’t remember a time when the concern about inventory was that significant,” Scott Rankin said. He leads the consumer and retail team for KPMG. Last year, there was an expectation that holiday sales would be lower-than-normal because of the pandemic. However, stimulus and additional online spending resulted in an 8.3% increase over 2019.


What’s causing the shortages and supply chain issues for holiday shopping?

It’s a combination of factors. However, experts say it comes down to truck driver shortages, supply chain disruptions brought on by the coronavirus pandemic, and congestion at ports where goods make their way into the U.S.

For example, this could be a greater issue for toy makers as a higher volume of these products are produced internationally. As some countries struggle with vaccination, it’s slowing the arrival of goods – which isn’t expected to improve anytime soon.

“There’s going to be a major shortage of toy products this year,” MGA Entertainment CEO Isaac Larian told CNN in September. That means contingency plans for these manufacturers and retailers, who are creating ‘safety stock’ plans. In fact, 59% of retailers plan to move in this direction as the fall turns into holiday season.


Is buying early a good approach given the shortages expected this holiday season?

The answer is a resounding ‘yes’. In fact, some retailers are moving more quickly into holiday shopping season because of it. While some consumers have long-waited until the last minute to do holiday shopping – that likely won’t be very effective this time around. As some retail experts have framed it: September is the new December.

Every day that passes, as the actual holidays get closer – supply chain and shortages become more difficult to contend with for retailers. If product runs out in November – odds are that there won’t be enough time, or supply, to compensate before the holidays arrive in December.

So plan ahead – and be flexible about where holiday shopping happens as 2021 will be dominated by shortages.



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