Skip to navigationSkip to content
RUINING CHRISTMAS

It’s already too late to ship goods to the US in time for Christmas

A Christmas tree is pictured at a closed shopping district in downtown Beirut.
Reuters/Mohamed Azakir
It won't be a smooth road to Christmas.
Published

It’s peak Christmas tree-buying season. That would normally be good news for companies like Balsam Hill, a California-based retailer of artificial trees.

Instead, they’re facing a nail-biter of a holiday season, as their short sales window collides with a global supply chain snarled from the ports of China, over the Pacific, through the US ports, and into the country’s faltering network of inland delivery routes.

A Christmas tree supplied by the company is “almost like a perishable good,” said Mike Shaughnessy, senior vice-president of operations and supply chains at Balsam Hill. “It’s like a gallon of milk. If you don’t get it by the sell-by date, it’s no good to the consumer.”

Before the pandemic, Balsam Hill could expect their trees to ship on the day they scheduled them to ship. Now it can take an extra five weeks for them to depart. There’s a delay of another two weeks—up from a day or two—to get their containers delivered to warehouses, which are overwhelmed, adding another “several weeks” to the timeline.

Reliability, a measure of on-time arrivals, is at a record low at 33.6%—meaning two-thirds of shipped goods into the US are arriving late—according to Sea-Intelligence, a maritime research firm. Freightos, a Hong Kong-based online shipping marketplace, has found that delays for finished goods are averaging 72 days. The Institute for Supply Management found that shipping times for parts have stretched to an average of 92 days, the longest since they started keeping records in 1987. That means that even goods assembled in the US may be delayed as they wait for components from China.

With 75 days until Dec. 25, if the a retailer’s container isn’t already on the water, they’ve missed Christmas.

Balsam Hill began shipping their trees in the summer, and found themselves jostling for space even then. Rather than being able to import all twenty of their containers on a single ship, this year, their imports have been splintered: two containers on one ship, three more in another, burying staff in extra customs paperwork. A shipment of tree toppers made from capiz shells has been stuck in the Philippines since June. Shaughnessy said he’s “fighting for space,” even as he watches the estimated arrival dates recede from Nov. 30, to Dec. 15, if then.

“It’s a constant struggle,” Shaughnessy said. The operational challenges now rival what he dealt with in his previous career with the military.

By the time goods arrive in the US, they face a different set of roadblocks. Courier companies like FedEx have struggled with the holiday rush, moving their ground transport cut-off date to Dec. 15, up from previous years’ dates of Dec. 19 or 20. And the risk of missing Christmas looms. Last Christmas, FedEx delivered over a million packages late. Supply chain issues have considerably deepened since.

Shaughnessy says that while the majority of their goods are arriving late, they’ve been preparing for this all year. He believes they have enough goods in place to fulfill their orders. But “for some retailers, this could be catastrophic,” he said.

The knock-on effect of shipping delays 

Consumer demand across the US remains high. Deloitte estimates holiday sales will be 9% higher compared with the previous year, with other analysts forecasting it to be as high as 10-13%. “It’s going to be a rough holiday, and I think it’s going to be a holiday unlike anything we’ve seen before,” Matt Garfield, a managing director for a retail consultancy, said in an interview with Retail Dive, a trade outlet. “We’re going to see a lot of bare shelves.”

How companies deal with the delays will depend on consumer response, said Nathan Strang, a senior manager of ocean operations at Flexport, a San Francisco-based freight forwarder. If consumers accept that some things will arrive late, then the companies can better take the fallout from delays in stride. If they decide that a late arrival has ruined the holidays, the anger is likely to be passed on to the retailer, and back up the supply chain to the forwarders, trucking companies, warehouses and ports.

“You don’t necessarily want to pick who wins Christmas,” Strang said. But with time and space at such short supply, goods will arrive late, and some companies will inevitably be deprioritized, or to pay premiums to jump the line.

As for Mike Shaughnessy, nothing short of time itself adjusting to the intractable short-term snarls of the supply chain could solve his delivery woes. He needs, he said, “20 more days in the year, six more hours of the day, and another five folks on my team.”

The arrival of Christmas is unlikely to bring immediate relief. Unpredictable delays mean Shaughnessy is bracing himself for the logistical challenge at the flip side of late deliveries: the trees coming back in a wave of returns.

📬 Kick off each morning with coffee and the Daily Brief (BYO coffee).

By providing your email, you agree to the Quartz Privacy Policy.