COVID Surge Slows Supply Chain Recovery

The recent COVID-19 surge both in the U.S. and globally has slowed supply chain recovery efforts as manufacturers, shippers, and ports manage through absenteeism due to increases in cases, says Boyden Moore, Orgill's president and CEO. In his ‘2021 Orgill Summer Executive Address,’ he said the challenge isn’t just due to the increase in COVID, however. The U.S. unemployment rate at 5.4 per cent in July is at its lowest since March of last year when the pandemic began. “Retaining your best employees and recruiting new employees to your team has perhaps never been more difficult and important,” he said. Additionally, inflation is at the highest in a very long time and the impact is being felt. “We typically have about 18,000 to 19,000 items with price changes in a year’s time. We’ve seen almost four times that amount so far this year and most of those changes have been increases,” said Moore.  It is also working hard to re-establish its service levels which have suffered in the last 18 months and “we will begin to see better recovery in the coming months. However, we also believe that it will take longer into 2022 before we begin to return to our historical standards.” One of the biggest reasons that service level hasn’t recovered more quickly is that demand for home improvement products has remained so high and will remain high. It budgeted for a seven per cent increase in sales. However, in the first half of 2021 sales were up 21 per cent