The global reasons why you can’t buy what you want right now
The global reasons why you can’t buy what you want right now
From chicken tenders to toys to bottles of wine: 7 items hurt by backlogs or rising prices.
By Phil McCausland
Illustrations by Anuj Shrestha for NBC News
Nearly two years into the Covid pandemic, the virus that has infected millions and killed hundreds of thousands of Americans continues to disrupt the powerful supply chain that moves goods from factories to U.S.homes.
The problems seem endless and varied — creating headaches for manufacturers down to consumers:
Liquor producers can’t get enough glass to make bottles in their signature shapes.
A fast food restaurant had to cancel its marketing campaign because labor shortages led to a scarcity of chicken tenders.
Sets of Lincoln Logs are languishing in factories because they’re missing the plastic doors.
And Americans are having trouble getting wheelchairs because Covid outbreaks in Vietnam have held up the rubber tires.
All the while, gasoline production isn’t ramping up at the same rate of demand, which means prices at the pump could remain high for months to come.
The long list of problems underlines the fragility of the U.S.supply chain, and it’s keeping Americans from purchasing or forcing them to pay a premium for their favorite products.
NBC News looked at seven items affected by backlogs or rising prices, and spoke to industry leaders and experts about the supply chain problems that have caused the items to become more expensive or hard to find.
Beer, wine and liquor
The alcohol selection at holiday parties might look different this year, as beer, wine and liquor producers warn that they are having a tough time maintaining consistent production and distribution to customers.
Beer makers are searching high and low for carbon dioxide, commonly used to carbonate brews — a shortage that cropped up in the U.K.
even before the pandemic .Metal parts for machinery, aluminum for cans, and even malt and hops are also hard to come by.
“We can’t count on our suppliers to have inventory,” said Bill Cherry, the founder and brewmaster of Switchback Brewing Co.in Burlington, Vermont.
“So we’ve been working really hard, and the way we’ve protected ourselves is we kind of became our own warehouse for this stuff.”
Winemakers on the West Coast have lost vineyards to forest fires and smoke.Liquor and wine producers are also struggling to replenish their supplies after a surge in demand last year, particularly as wine and liquor tend to require more time to produce.
.The most consistent obstacle for many beer, wine and liquor makers, however, is obtaining glass bottles — especially if their bottles are special shapes.Even though domestic glass manufacturing is at full speed, said Scott DeFife, the president of the Glass Packaging Institute, the country imports 20 percent to 30 percent of its glass from overseas.
Those glass bottles are hitting some of the same bottlenecks at ports that other products face, DeFife said, noting that the ports on the West Coast are jammed up and that glass manufacturers in Italy and France ran into Covid-related export issues.That’s where a lot of the specialty bottles are coming from.
“If you’re willing to use a relatively generic bottle that is in use, there’s a greater variety of places you can source that from,” DeFife said.
The problem for America’s booze industry, however, is that a lot of value is put in a company’s brand identity.Some winemakers, for example, have said they are keeping wine in barrels longer, which could negatively affect taste, in hope of obtaining the correct bottles.
For Roman Roth, the winemaker at Wölffer Estate Vineyard on Long Island, New York, the colorful labels, bottles and packaging are all part of the brand identity his customers have come to love, but it’s really difficult to obtain all the necessary glass, particularly as his brand has an opportunity to expand in the wine market.
“Basically, I have to order now for next September’s bottles — it’s a big race of who can find the right bottle,” Roth said.
“It becomes a real issue, because you can’t always change the mold.It means you need new labels, new plates, new parts for the bottling line.Everything has a snowball effect.”
America loves chicken tenders — especially when they’re battered and fried — but this year they cost quite a bit more than they have in years past.
The average price at major retail supermarkets for chicken tenders, a specialty cut of the bird’s breast meat, has risen from $4.76 per pound in November 2020 to $5.20 per pound this month, according to the Agriculture Department.The cost of a pound of organic chicken tenders went up by $1.51 over the same period.
Beyond home kitchens, supply chain issues related to chicken tenders have also hit restaurants.
A&W, the root beer chain, canceled a chicken tender marketing deal this year because its supplier couldn’t deliver extra poultry stock to its restaurants.KFC said it struggled this year to obtain its normal supply of chicken, although a spokesperson said in an email that “supply of products, including chicken, has improved.”
Hattie B’s Hot Chicken, a popular chicken restaurant chain in Nashville, Tennessee, said the price for all parts of the chicken skyrocketed during the pandemic.The biggest pain for the chain, however, is its bestseller — the chicken tender.
“We acutely feel the pain right now on chicken tenders,” said Brian Morris, Hattie B’s vice president of culinary, learning and development.“And it’s tough.
It’s kind of a three-layer sandwich, and none of the layers are delicious.”
Morris said the three layers are the rising market costs, which are at all-time highs; the increase in costs for shipping, plastic and packaging; and a lower-quality product.The company has noted, Morris said, that the chicken tenders it gets are increasingly inconsistent in size, which has led it to reject a lot of what it receives.That further limits its yield.
“We’re just taking it on the chin and hoping it gets better,” he said.
The main issue is in the supply chain, as meat processors struggle to hire and retain workers after their workforces suffered rampant illness and deaths at the height of the pandemic.
During Tyson’s earnings call with investors in August, the company’s CEO, Donnie King, said recruiting workers remained one of its biggest challenges.More recently, the company identified logistics expenses and the cost of ingredients and packing materials.
King said Tyson, one of the largest chicken producers in the world, has raised wages and is piloting new child care and medical facilities for its workers.
It also aims to automate less attractive and more dangerous jobs that it has struggled to find employees for and then retrain some workers to oversee the process.
Tyson, which did not respond to a request for comment, and other meat processors have also tried to shore up its employees’ health and limit processing pitfalls by mandating vaccinations for their workers.
But a lingering problem for one segment of the industry is Tyson’s decision to change the rooster it used for breeding this year.It didn’t meet expectations and led to lower hatch rates among the company’s chickens, so the company has had to switch back to its former breeding rooster.
“We’re changing out the male [rooster] that, quite frankly, we made a bad decision on,” King said in an investors call in May.“And we will not be all the way right till, let’s call it, mid-year of ’22, but we will sequentially get better between now and then.”
Medical supplies and equipment
For months, Cecilia Blackmon has struggled to obtain common medical equipment, including crutches, wheelchairs and walkers, for her shop, the Family Medical Supply Store, in a suburb of Birmingham, Alabama.
In the past she would get a wheelchair in just a few days, but now the wait is about eight weeks.It’s the same with crutches: She recently got an order she’d placed more than six weeks before.
“Thankfully we’ve ordered enough each time to get us through, but with wheelchairs it’s tough,” she said.
“I can’t give a patient something they need, and that’s happened with some of the wheelchairs — I just can’t get it for them.”
Oxygen tanks are also in short supply, because they are still in high demand for coronavirus patients.Meanwhile, hospitals in multiple states are asking people to donate their lightly used wheelchairs and crutches because of shortages of both.Distributors are also reported to have back orders for IVs, bedpans and suction canisters.
The Health Industry Distributors Association, a trade group for medical supply companies, said in a letter to the Transportation Department last month that the situation had become untenable and asked for the Biden administration to step in.
Producers say the problems are multifaceted.Although most of these types of supplies are produced domestically, a few individual component parts come from Asia and are stuck at the ports, causing massive backlogs.
Some also face labor shortages at their production facilities in the U.S.
Larry Jackson, the president of Sunrise Medical North America, said he has over $10 million in inventory of partly produced medical supply equipment that his company has been unable to complete because of a lack of parts.
“We’re struggling because we’re missing one part here and one part here and one part here,” he said.“Those parts are usually parts that we can’t manufacture ourselves, like electronics for chairs or tires.”
He said that tires typically take five weeks to travel from China or Vietnam but that now it can take about 90 days for them to arrive at the company’s facility in Fresno, California, which is short about 10 percent of the workforce it had before the pandemic.
His company also faces high prices for cargo containers .While Sunrise Medical used to pay $1,500 to $1,800 depending on a container’s final destination, he said, it recently paid $22,000 for one container because a shipper said it would hold the container for a later boat if Sunrise didn’t pay the huge sum.
U.S.toy companies are wrestling with supply chain issues to ensure shelves are full as holiday shopping hits full swing.
Expectations are low among many leaders in toy manufacturing that they will be able to stock shelves with this year’s favored toys before people start unwrapping presents.
On a recent earnings call, Hasbro said it already expected to suffer a $100 million loss this holiday season because supply chain backups are making it difficult to fill orders.
Toy companies face multiple challenges this year, starting with a heavy reliance on production in Asia and importing items across the Pacific.
While there are typically hiccups in the supply chain most years, it appears that the entire system is askew this year, from the toy production facilities to the retail workers stocking the shelves.Costs have ballooned, with freight companies charging on average $10,000 per container in recent weeks; before the pandemic, it would cost about $1,500, according to the Freightos Baltic Index .
Although the ports on the West Coast are beginning to be cleared, thanks to expanded hours ordered by the Biden administration, there is still a struggle to find truck drivers to move the toys across the country, said Jay Foreman, the CEO of BasicFun, the company that produces popular items like K’Nex, Tonka Trucks and Fisher-Price toys.All of it contributes to thinner margins and a more challenging cost structure.
In a normal year, he said, a Tonka Mighty Dump Truck might sell for $25 to $30, while the cost of transporting it from China to a Walmart, Target or Amazon distribution center is around $1.75.This year, transportation costs have ballooned on average to $10 per truck.
Even domestically produced toys are held up.
Foreman’s company also produces Lincoln Logs and K’Nex.The logs are made in the U.S.
but he said partly assembled toy sets are sitting in factories because he can’t get the plastic doors for the Lincoln Log sets, which are made in China, and because two chemicals needed to produce K’Nex are in high demand with limited production capabilities right now.
“From our standpoint, the goose is kind of cooked,” Foreman said.“We really can’t do much to affect whatever’s going to happen.It’s going to take weeks to unclog the ports, it’s going to take weeks to move the goods around the country, and there’s only seven weeks left in the holiday season.”
Video game consoles
The video game industry is huge and growing.
The global consulting firm Accenture values its direct and indirect value at $300 billion — more than the music and film industries combined , thanks to a surge in mobile gaming from people seeking ways to connect remotely and stay entertained during the pandemic.That hasn’t saved it from supply chain woes, however.
The surge in demand, accompanied by a holiday boom, has many companies struggling to keep up.The biggest challenge is a shortage of microchips and semiconductors.
“We’ve seen unprecedented demand for Xbox Series X|S, and we’re working as fast as possible with our manufacturing and retail partners to expedite production and shipping to keep up with it and the ongoing supply constraints,” a Microsoft spokesperson said.
While the semiconductor shortage is likely to affect Microsoft’s ability to manufacture its latest Xbox console, that’s not the only reason hardware companies are scrambling.
Michael Pachter, a video game analyst with Wedbush Securities, a Los Angeles-based investment firm, said companies, even in normal years, always come up short when they’re rolling out new systems because of the challenges of production and to keep up with demand.
Add to that Covid outbreaks in Southeast Asian manufacturing plants among the skilled workers who build the consoles, increased shipping costs that cut further into typically thin margins for consumer electronics and massive port and shipping delays that are causing them to ship fewer units than in years past.
“Sony isn’t airlifting PlayStations — they’re just not doing it,” Pachter said.“They’re just like, ‘screw it.’ Their attitude is if you don’t buy a PlayStation 5 this Christmas, you’ll buy one next Christmas.They’re just extending the cycle another year.Microsoft’s thinking the same.”
Sony didn’t respond to a request for comment about the challenges consumers have had obtaining its latest PlayStation, the PS5, since it launched in November 2020.PS5s are priced at $400 for the low-end unit, but scalpers are reselling consoles to eager gamers for $800 to $1,100 on websites like eBay.
Nintendo, which declined to comment, cut the sales forecast for its Switch video game console by 1.5 million units this month even though it recently released a new version of the Switch.The head of its hardware department said they were reviewing their designs and evaluating alternative components that might be more readily available.
Panic, a game company that developed a handheld game device that features a black-and-white screen it has named Playdate, said that after it got a plethora of pre-orders for the game system, it immediately placed a new order with its factory.
The company was told it wouldn’t be able to obtain the central processor it needed for 730 days — or two years.
Similarly, Valve, a popular video game company that produced such games as Half-Life and Counter Strike, announced this month that it was delaying the release of Steam Deck, its much-anticipated handheld gaming computer, until next year.
For many people, the transition to work from home began with swapping office attire for sweatpants and other stretchy, soft clothing.
The purchase of athleisure clothes, as these wardrobe items are known, boomed last year, and the surge in demand has continued this year — which has aggravated numerous pain points within apparel’s long supply chain.While Americans may not notice it on shelves yet — beyond a sudden lack of sales and a spike in prices — the journey of a pair of sweatpants and other athleisure items is long and increasingly expensive.
Clothing is an everyday item that isn’t typically produced domestically: More than 97 percent of apparel sold in the U.S.
is made in other countries, according to the American Apparel & Footwear Association.Much of the production was based in China until the Trump administration made major changes in U.S.trade policy.
“A lot of apparel companies made a real push to diversify out of China for good business reasons that were catalyzed by the Trump tariffs,” said Bryan Eshelman, a managing director at AlixPartners who specializes in retail and supply chain management.“By definition, they went into smaller countries, like Vietnam and others in Southeast Asia.
The issue is that these are not big countries with huge production bases to begin with, and recent Covid shutdowns really affected the store goods industry overall, especially retail.”
Major production plants were shuttered for weeks because of Covid outbreaks in the region over the summer, and factories have struggled to bring back workers.That made meeting the huge spike in demand much harder for companies, but it also came as shipping costs — as well as cotton and fabric prices — are at all-time highs.
For Fourlaps CEO Daniel Shapiro, who founded the startup that partners with major companies like Peloton to create athletic apparel, it has been one headache after another.Boat lead times have gone from 37 days to 80 days.
Shipping by air is astronomically expensive.
He said that the company has essentially canceled outerwear sales and that he had to delay the launch of his women’s line last year because 30 percent of his stock was stuck in Vietnam.On top of those immediate problems, he’s already working on shipping for a new line that comes out in a year.
“We’ve faced all sorts of issues, from an insane amount of cancellations to trying to get customers into other styles,” he said.
Major companies, from Lululemon to Gap and Nike, have increasingly depended on air freight to get them through the holiday season, according to reports .Some have also begun moving their production facilities closer to the U.S.in hopes of shrinking the supply chain.
“A lot of apparel retailers and brands are deciding to air in goods so they don’t lose customers during this disruption,” said Eshelman, who noted that many companies’ economic performances are rising because they’re not marking down goods.“My question is how will all this persist once these prices come home to roost and have to be passed down to customers?”
Shipping problems aren’t limited to international supply chains, however.
Boathouse Sports, an athletic apparel brand started by former U.S.Olympic rower John Strotbeck, produces all of its clothing outside Philadelphia.CEO Cindy DiPietrantonio said she was very thankful that she doesn’t have to contend with the ports or high shipping container costs but that domestic shipping is also a huge challenge.
She said Boathouse has experienced serious increases in delayed pickups, lost packages and late deliveries by domestic shipping companies during the pandemic.
Boathouse has also struggled to hire for many open positions.Those two aspects have made it very difficult to keep up.
“The demand is way up, but we have all these pressure points we’re hitting even though we have the product in hand,” DiPietrantonio said.
“It feels a bit like getting a watermelon through a garden hose.”
Perhaps one of the most eye-popping price changes many people have contended with is the cost of gasoline at the pump, and it has also increased financial burdens for companies moving products through the supply chain.
The average price in the U.S.rose to $3.40 a gallon early this month, according to AAA.That’s the highest price in years, and it comes after the oil market bottomed out at the height of the pandemic last year.
consumption of gasoline plummeted by over 25 percent in the second quarter of 2020 before it surged by more than 27 percent above supply in the second quarter of 2021, according to the Energy Information Administration.
Meanwhile, countries that produce the world’s oil have operated cautiously and been slow to ramp up production.The industry has faced some issues with gas truck drivers domestically, but the biggest issue is getting the supply to meet the moment.
OPEC and Russia agreed in July to cautiously ramp up production by 400,000 barrels per day each month until next year, which would bring OPEC back to pre-Covid output.In the first week of November, they declined to increase production further.
“Americans are simply paying more because of an imbalance between supply and demand,” said Patrick De Haan, the head of petroleum analysis at GasBuddy, a tech company that studies real-time gas prices.“Demand is up very high.BP forecast that global oil demand to be around 100 million barrels, and we’re a few million barrels under that right now.
That’s really pushed up the price of oil and the price of gas.”
De Haan said it may appear to some people that gas prices rose soon after the country elected Joe Biden to replace Donald Trump as president, but he said politics has little to do with the cost increases.It is simply an imbalance of supply and demand created by Covid, for which there may be little relief.
He predicted that gas prices won’t grow much higher but that they will remain near this peak through the holidays and into next year.
“Covid is in the driver’s seat of where prices are going,” De Haan said, “and probably will be for the next six months to a year.”.