Ikea sees supply-chain shortages stretching into mid-2022
The worldwide supply-chain crisis won't end anytime soon, leaving consumers everywhere to grapple with shortages well into 2022, the CEO of global home-furnishings giant Ikea said.
"I don't think we will be out of the woods" during the Swedish retail giant's fiscal year, which ends in August, Inter Ikea CEO Jon Abrahamsson Ring told Bloomberg News. Inter Ikea is the worldwide franchiser for the Ikea brand.
"This is a very big challenge for the whole supply infrastructure," he said, with one of the biggest challenges for Ikea and other retailers is getting goods out of China.
Shipping delays are so severe in the U.S., the White House got involved Wednesday, saying officials helped broker a deal to open the Port of Los Angeles 24 hours a day, seven days a week. Some 40% of the nation's imports come through ports in L.A. and Long Beach, California.
Ikea, with more than 50 U.S. locations, is concentrating on stocking its most popular brands as well as lower-priced items, Abrahamsson Ring said.
Global supply chain bottlenecks and shipping delays mean the closer to the December holidays the calendar gets, the less likely some store shelves may be filled with what consumers want most.
Many retailers ordered weeks or even months early in hopes of getting U.S. goods on shelves in time for the holidays. Like other big retailers, Ikea has sought ways to speed up the movement of goods, including renting shipping containers directly and looking for alternative routes.
"It is re-steering and re-routing. And on the retail side we have learned agility like never before because every day you have to work with what you have. You have to find ways to solve customer needs with limitations that we have never seen before," Jesper Brodin, CEO of Ingka Group, which owns most IKEA stores, told Reuters.
Even though some retail shelves are stocked ahead of the holidays, a growing number of experts expect the snags to continue into 2022.
"Despite some short-term let-up, we see the global container and import bottle necks continuing well into the next year," said Mark Szakonyi, executive editor of IHS Markit's Journal of Commerce.
