Covid Impact: Retailers facing multiple challenges amid supply chain issues

Challenges getting goods to New Zealand amid the Covid-19 pandemic, including to the right port, has seen importers pay thousands of dollars in additional fees.

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The fear is the status quo will continue if nothing’s done to free up the supply chain. Source: 1 NEWS

Now there's a warning from some retailers that their future is uncertain, if nothing is done to free up the supply chain.

At Whangārei’s Northport, a container of luxury furniture and home goods is destined for Auckland, the cost of getting it there, now up to the importer.

“We will be paying for the extra freight to get the containers down here, which is about $1800,” says Mark Wilkinson, Director of CC Interiors.

Millions of dollars of work has been done on the rail line between Whangārei and west Auckland, it's hoped some of those improvements will make things easier for importers like Wilkinson.

His company brings in products from around the world, to sell onto boutique retailers.

Meanwhile, the cost of filling the showroom is getting higher every month.

“We are talking containers which perhaps originally cost $1200 to $1800, I mean they really are going through the roof, a recent container cost us as much as $11,000,” Wilkinson says. 

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But Ports of Auckland says the pandemic has led to issues out of its control. Source: Breakfast

It’s a problem for importers across the country.

“Those costs are up 400 per cent in twelve months to bring a container to New Zealand,” says Chris Edwards, Customs, Brokers & Freight Forwarders Federation.

“We have never seen empty shelves. Retailers pride themselves normally at having shelves full,” says Greg Harford of Retail New Zealand.

The increasing cost to meet demand are an ongoing issue for the struggling retail sector.

“There’s less freight coming down to New Zealand in the first place. It’s taking longer to get goods off the ships here in Auckland and elsewhere in the country and into distribution centres - and that’s having a sort of a snowball effect,” Harford says.

Ultimately it's the consumer who may pay.

"I don't think we are necessarily going to pass all these costs on, but I can see some significant increases in prices,” Wilkinson says.

Edwards agrees.

"You and I will pay more on the shelves for most commodities that are imported - it's inevitable,” he says.