Shelves Remain Stocked, Even as Supply Chain Disruptions Persist
11/16/2020 · Newsroom Highlight
When the Coronavirus pandemic hit, supply chains across industries and around the world experienced a historic shock. That, coupled with the subsequent surge in demand that rippled through the grocery industry, resulted in weeks of empty shelves and near-impossible-to-find essentials across the country. Eight months later, our shelves are in much better shape, but we continue to feel the effects of the pandemic on supply and demand. As the number of cases are again on the rise, some are worried about a repeat of the product shortages the country saw last spring.
“What the grocery industry experienced in March was unlike anything we had ever seen before,” says Sarah DePeters, vice president of grocery, dairy, frozen merchandising. “We’ve certainly learned from that experience, and have worked incredibly hard since then, not only to replenish supply, but also to make sure we don’t find ourselves in a similar situation.”
Since the beginning of the pandemic, every category has, at one time or another, experienced supply chain challenges.
“While there have been common challenges across all industries and suppliers, each has also faced unique challenges that go beyond the obvious when confronted with increased demand and operating during a health pandemic,” explains DePeters. “Changes in consumer behavior, product and packaging manufacturers working at capacity, transportation and import delays, and of course, the limitations of only being able to grow crops and raise livestock so fast, are just a few of the challenges suppliers are encountering.”
Take for example, the two categories most impacted by the pandemic – paper products and cleaning supplies. Beyond the initial days of panic buying, consumers’ desire to clean more during this global health pandemic continues to drive demand that exceeds supply in these categories. But the continued supply challenges go deeper than that. Not only are people cleaning more often to keep themselves and their families safe, they’re also spending more time at home, which inherently increases the need to clean more often. Disinfectant wipes, one of the hardest hit products during panic buying, continue to be scarce due to challenges throughout the supply chain, including the manufacturing and importing of the canisters. Consequently, more people have turned to household cleaners in trigger bottles, which require paper towels. That has further increased the demand for paper towels, one of the oldest manufacturing industries in the country that was already operating at capacity prior to the pandemic. The increased demand for trigger cleaners, has also made it difficult for manufacturers to keep up with bottle and trigger production, much of which is done overseas.
Another consequence of consumers spending more time at home, is them cooking and baking more. As a result, we’ve seen increased demand in categories such as meat, seafood, baking, and cuisine-focused categories (Asian, Latin, Italian, etc.). Unlike the sudden panic buying in March, this shift has been more gradual, which has lowered the impact on supply, but not completely avoided it.
Going into the holidays, some national brand suppliers continue to face supply challenges on key items, like stuffing, gelatin, and gravy. To help ensure the available product is spread evenly across retailers, suppliers have placed these limited-supply items on allocation, controlling how much product each retailer receives. To ensure we have options available for customers in every category, we’ve spent the last several months sourcing additional suppliers, bringing in new brands, and working with our Wegmans Brand suppliers to build up our holiday and winter reserves, in our own warehouses, as well as at our suppliers’.
Anticipating the potential for another wave of the virus heading into cold and flu season, our merchandizing team decided early on to continue purchase limits on key products – paper towels, household cleaners, bath tissue, etc. – through the end of the year (at least), even as additional inventory became available over the summer. Taking this approach helped us replenish what was on the shelves, curb panic buying, and start building our reserves.
“Looking back to where we were in March at the start of the panic, and where we are today, eight months later, it’s incredible to think about how much we’ve learned, and how much more we all know about living through a pandemic,” comments DePeters. “Our merchandising and store teams have done an incredible job ensuring our customers have options available in every category. If everyone focuses on buying what they need, when they need it, there will be plenty to go around.”