Coronavirus lock down ecommerce impact will get worse before it gets better

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With China in an ongoing province by province, city by city Coronavirus lock down, the impact on commerce will soon start to tell, even more so than reports that are already coming in concerning shipments not leaving ports.

Back in 2003 then the SARS virus hit, China was a producer of stuff that didn’t matter that much – clothing, toys, trainers, marketing merchandise. Today in 2020 China is very different and is now a major manufacture of electronics for everything from TVs to iPhones. Even where they don’t make the entire product, they manufacture many components vital to the production of modern world devices.

For products such as clothing, allowing for factory capacity, it’s not that difficult to move production to other low labour cost economies outside of China and the Coronavirus lock down. It’s not as easy for electronics however and major manufacturers will soon start to run out of stock. Apple for example only holds around a month’s worth of finished iPhones in stock and once they are sold replenishing stocks will be impossible until China reopens for business.

Even when factories are able to reopen, they will be way behind on production, may be reliant on other suppliers for components, and may still face staff shortages due to sickness leave for some still under suspicion of the Coronavirus. Even the cancellation of passenger flights to and from China is having an impact on trade – passenger planes often carry commercial goods in their holds as well as passenger’s luggage and with planes not flying goods aren’t moving.

The Coronavirus lock down may not have impacted you yet, especially if you don’t import direct from China. However it’s time to start considering your options if your current suppliers or manufacturers start to run out of product. Do you have alternative sources of stock that you could access, could you commission manufacturing in a different territory? What’s your emergency plan to keep your business trading?

2 Responses

  1. It certainly is becoming concerning now for the importers who we have been speaking to re: Spring stock for garden centres. Hopefully it will all be resolved soon as there is a lot of positivity in the air for 2020 retail so need to continue with the momentum!



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