Why Are We Still Experiencing Supply Chain Issues?

MINNEAPOLIS (WCCO) -- It's hard to forget last year's rush for plush, as toilet paper became one of the hottest items when the pandemic began.

Now, it's food, clothes or whatever else is down that aisle you're walking.

"I was looking for hydrogen peroxide. I can't find it anywhere. I had to order it online," said Lisa Savage of St. Paul.

Other people have reported visiting multiple stores across the Twin Cities to look for a single product, only to find none of them have it.

Why are we still experiencing supply chain issues? WCCO spoke with George John, marketing professor at the Carlson School of Management at the University of Minnesota.

"Some folks in the business and economists call it the 'O-ring effect,'" John said.

That's in reference to the 1986 Challenger space shuttle disaster, in which a faulty O-ring led to the shuttle exploding shortly after takeoff. John explains how it relates to a supply chain.

"It means a small part that you're buying can shut down your whole supply line or your whole assembly line because you can't easily substitute that part to another part," he said.

For example, a recent computer chip shortage slowed production of new cars. That tiny part put the brakes on a massive industry. How do transportation issues play a role into this?

"It's part of that same thing," John said. "Any bottleneck anywhere brings that whole thing to a halt."

Cargo ships stuck at ports in Los Angeles earlier this year slowed products and parts from across the world from getting to their next destination.

COVID-19 has also shown a penchant for stopping production lines as outbreaks at factories have forced shutdowns. It happened early on at meat packing plants across the Midwest.

"It's just affecting everybody as far as how are they going to get the product in stores, and then we don't have the people to sell it and stock it," Savage said.

The supply chain issues come at a time when families will be stocking carts with school supplies. The National Retail Federation expects consumers to spend $37.1 billion on back-to-school item -- up $33.9 billion in 2020.

"Your son or daughter is not going to suffer in school if they don't have the exact color Sharpies that they used to have. Just be flexible," John said.

And flexibility is what he predicts you'll have to show this fall and winter when the holiday shopping season ramps up.

"I think it's just a little exercise in humility for all of us that maybe we were just spoiled rotten having everything we ever wanted," he said.

Online shopping can sometimes be helpful when there's a spot shortage. But if a store is out of a specific brand of a product, it likely will be the same way online.

A Target spokesperson gave WCCO this statement:

We're committed to helping our guests find what they need at a great value whenever they shop at Target. Our teams work closely with partners to manage inventory so we can deliver a great shopping experience for all.

A Cub Foods spokesperson gave us this statement:

Products rolling in and out of stock have become more common, causing frustration for the consumer, but these spot outages are on a much shorter timeframe than other consumer products like cars, only lasting about a week on average. However, the reason for these outages center around product flow, not product availability. From our conversations with food manufacturers, the product shortages are mostly caused due to the delay of inbound product and packaging to the manufacturer, causing interruptions in outbound shipping to retail locations.

Certain items are feeling additional pressure due to supply chain challenges more than others, such as sports drinks or juice boxes. While the category as a whole has enough product, individual brands inside the category may experience lower supply for around a week before returning to normal levels.