Sneaker shortage, other supply chain issues slowing back-to-school sales

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The 2020 back-to-school shopping season was the worst in Sneakerology history. Children who attend classes virtually from home due to the COVID pandemic can do so barefoot if they choose.

The owners of the 12-year-old business with two stores, in Manhasset and Greenvale, were hoping that the return of students to in-person classes in August and this month would mean a return to pre-pandemic buying numbers.

Sales have improved but are hampered by another culprit: supply chain issues.

Delays in getting merchandise to stores and the higher prices consumers pay as a result are not going away anytime soon, and the back-to-school shopping season has been extended by weeks as parents return to stores for find items that were not available. earlier, retail experts said.

“A lot of companies have warned us that it is going to be difficult until next year due to plant closures,” said Ira Penziner, co-owner of Sneakerology.

Nationally, retailers face unprecedented supply chain challenges as goods factories around the world experience work stoppages due to the pandemic. “It comes down to high demand, insufficient capacity to meet that demand and we’re basically trying to resupply America after going through the COVID peak in 2020,” said Matt Priest, president and CEO of Footwear. Distributors & Retailers of America in Washington, DC

Stimulus payments Americans received also fueled demand, he said.

Imports are 99%

Clothing and footwear factories in Vietnam and southern China have experienced several weeks of shutdowns that have halted production. Imports make up 99% of the shoes sold in America, Priest said.

Another driver of the shortage is the rising costs of transporting manufacturers to historic levels, he said.

Shipping rates for 40-foot containers that averaged between $ 2,500 and $ 3,000 last year are now between $ 18,000 and $ 20,000, said Nate Herman, senior vice president of policy at the American Apparel & Footwear Association in Washington, DC

On September 17, the Shanghai Weekly Containerized Freight Index, the most widely used index for ocean freight rates for imports from China, rose 1.2% to a record 4,622.51 $ for a 20-foot container, according to the association. This rate is about four times higher than a year ago.

More costs are pumped into the supply chain, but companies willing to pay the higher costs still can’t get their goods delivered because carriers fail to honor contracts, said Steve Lamar, president and chief executive officer. the management of American Apparel & Footwear. Association.

“This translates into empty store shelves, so commodity shortages… or higher prices,” he said.

Price spikes

From June to August, the average price of shoes was 17% higher than the same period last year and 9% higher than in 2019, according to the NPD Group, a market research group based in Port. Washington.

Prices for bags of books were 20 to 30% higher in some areas during the start of the school year compared to the same time last year, Herman said.

Customers paid 6% to 7% more for back-to-school purchases this year, he said.

“It will probably continue to get worse during the holiday season,” he said.

Sneakerology is not increasing its prices despite increasing its shipping costs, Penziner said.

“We’re taking the hit. It’s not the customer,” said Penziner, who said back-to-school 2020 store sales were down 15% from the same period in 2019.

But because of the shortages, customers have “been content” with styles of shoes that normally wouldn’t sell as well, he said.

Normally the busiest times of the year for the channel are June, due to the camp and back-to-school season, he said. Without the supply chain issues, the 2021 start to school year would have been comparable to 2019, he said.

Lester’s, a three-store retailer with locations in Greenvale, Manhattan and Westchester County, sells clothing and footwear for the whole family, but its target population is children and teens.

Sales in most categories have returned to 2019 levels, but store accessories and footwear inventories are down “due to supply chain issues,” impacting sales, he said. said Perry Schorr, president of the company.

Nationally, an increase

Nationally, the back-to-school shopping season has been strong compared to the same time in 2020, in part because last year’s clothing sales were so depressed.

Spending across a range of retail categories – electronics, clothing, furniture, and general merchandise – all performs well as students continue to replenish their school wardrobes and accessories after being away for most of 2020 “said James Bohnaker, associate director and economist in the Boston office of IHS Markit, a market information service headquartered in London.

IHS forecasts back-to-school retail sales to increase 11% from the same period in 2020, the largest annual increase since 1993.


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