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Chinese New Year 2021: What is Important for Retailers Now?

  • The Chinese New Year 2021 runs from February 12 to February 26, with a total celebration period of 15 days.

  • Every year, Chinese New Year brings with it the risk of delays in transport and rising freight costs.

  • Digital solutions for the supply chain on product-level provide help.

 

For importers, Chinese New Year (CNY) comes much too suddenly every year — much like Christmas in our personal lives. In China, 2021 marks the start of the Year of the Ox, which begins on February 12. This means that the one-week state vacations also begin, during which almost everything in China is closed, including factories, offices, ports and airports. As a rule, most offices and manufacturers are already working to a limited extent in the week before CNY. This is because most workers travel during CNY to visit their families, some of whom live far away from the production facilities. A veritable migration of people is beginning – and to ease the situation, companies are giving many employees time off. 

 

And that’s not all. After the one-week CNY state vacations, most manufacturers, offices and loading stations continue to operate on the back burner, with limited capacity. After all, many workers are using the time around CNY to look for a new job. And those who return to their old jobs are often still not back from visiting their families at the end of the government-imposed time-out. 

 

Challenge For All Parties Involved in the Supply Chain

 

CNY therefore poses a great challenge for retailers and forwarders, but also for suppliers in China. Why? Because goods that are supposed to arrive in Europe on schedule in February, March or April will not reach their destination until later, partly because of the production difficulties around CNY —  especially if retailers don’t make sure that their goods are produced on time. Before CNY, there is also a high freight volume in ports, as many large retailers replenish their warehouses beforehand. It is therefore a must for every retailer to order goods right now, in November or early December, and also take care of delivery so that they arrive before CNY or in March at the latest. 

 

The best thing to do is to make a plan for how much merchandise you will need in the first three to four months of 2021, so that you won’t be „dry“ after CNY. Because even after CNY, there is a large volume of freight in the ports, which means that container space is not only scarce, but freight costs are also higher. It’s very important that you make sure that your items arrive at the port 7 to 10 days before the planned loading date if possible, if you organize the transport there yourself. The increased freight volume means delays in truck traffic are highly likely.

 

Container Shortage, Container Shortage, Container Shortage

2020, the year of the Covid 19 pandemic, brings additional problems. Following the slump in freight volumes at the beginning and middle of the year, dealers from Europe, the USA and South America in particular ordered and are ordering large quantities of goods that have to be transported to the respective destination country. As a result and because a lack of imports to China, many Chinese ports are currently experiencing a shortage of empty containers. In addition, there are sometimes congestions in many destination ports (e.g. Los Angeles), so that empty containers are slow to return. The container shortage will certainly continue until CNY and beyond. 

 

This makes it all the more important to plan delivery at the same time you place the order. You may need to switch slots other than those previously preferred — which would also be relevant from a cost control perspective. 

 

If you have a high volume of containers, you should divide your goods into several bills of lading so that, in the event of a rollover, not all containers are rolled onto a ship other than the one intended. You don’t want your goods to end up in a different port of destination, which can happen because shipowners only ship complete shipments on the basis of the bill of lading. 

 

Combine Transport Modes

 

To ensure that your goods – or at least a large part of them – arrive on time, you should also consider different modes of transport or combining them. This is also a proven means of controlling costs. For example, some of your most suitable items can be transported by rail, others, which need to be on site quickly, by air. Or you can combine rail and sea freight or sea and air freight. However, capacities are limited here too and – again – containers are scarce. 

 

Forto Support You, Especially in Difficult Situations

 

That is why Forto recommends that you act right now. If you need support, we are here for you. With our digitally controlled logistics at product level, even in the difficult times around CNY, you will always have an overview of which goods are in which status from production to transport. You will know which modes of transport have sufficient capacity to bring your goods safely and quickly to their destination. You can easily change your mode of transport if unforeseen difficulties arise. And you always have a full overview of the costs incurred. We will be happy to advise you on our products. So that you have filled warehouses even at the beginning of 2021.

 

Reach out to us here for more information.