Black Friday, Cyber Monday and end-of-year holidays are around the corner. With the upcoming shopping season in mind, we wanted to provide guidance for journalists tasked with covering how local consumers and businesses are handling gift buying and selling amid global supply chain disruptions sparked by the COVID-19 pandemic.
We reached out to three academic researchers with experience studying supply chains for their thoughts on questions and angles journalists should explore:
- Joseph Sarkis, a professor at Worcester Polytechnic Institute who studies operations management.
- Simone Peinkofer, an assistant professor at Michigan State University who studies retail supply chain management.
- Christopher Atkinson, an assistant professor at the University of West Florida whose research has focused on business resilience during disasters.
“It’s important to understand what supply chain management is,” Peinkofer says. “It’s the flow of product from raw materials, through a manufacturing plant where the products are produced, and then distribution through wholesalers and retailers until they reach the end customers.”
Global supply chains have worked through disruptions in the past, but in early 2020 COVID-19 quickly and fully shut down international production hubs. News outlets have recently used images of huge container ships stuck outside the Ports of Los Angeles and Long Beach to help tell the story of ongoing supply chain disruptions.
Those images are powerful, but they may be reductive as the cargo jam appears to be loosening. Not all experts are convinced the supply chain disruptions are as severe as they’ve been portrayed.
“I’m waiting to be impressed by stories like that,” Atkinson says. “I don’t share the wisdom in getting people riled up about what might be nothing. I’ve been able to shop for my kids with no problem. I’m wondering what it is — what product I should be worried about.”
Read on for more insights on how to add context and nuance to your reporting as global supply chain issues continue while consumer demand around the holidays ramps up.
1. Know that while the underlying cause of the original pandemic-related supply chain disruption is straightforward, even a seemingly small disruption can break the chain.
The pandemic intensified the complexity of an already complex global supply chain system. Stories will differ from individual retailers on how they’ve managed supply chain challenges. But the big reasons behind those challenges are not mysterious.
“As soon as the pandemic hit everything shut down,” Sarkis says. “You can’t get stuff if you shut things down.”
The global supply chain is called a chain for a reason. Cut out one of the links and the chain collapses. Melbourne, Australia, home to that nation’s largest cargo port, has been shut down a total of nine months over six lockdowns since March 2020. Australia is a major metals producer and is the world’s biggest producer of lithium. Batteries in laptops, cell phones and electric vehicles all need lithium.
But, moving beyond major shutdowns spurred by the pandemic, the reasons behind ongoing supply chain issues become as complex as the global logistics system itself.
“Essentially, we’re still in the middle of a pandemic and there are shutdowns going on all over the world,” Sarkis says. “There’s going to be labor issues and this shortage or that shortage, there’s going to be regulatory issues. All of that has been discussed. There are multiple issues going on. In terms of the storytelling, in some ways it’s like the story of the night: They’re trying to simplify something maybe a little too much, when there isn’t one single answer.”
There are numerous other reasons for ongoing supply chain challenges, as Sarkis notes. The trucking industry in the U.S. is having trouble retaining drivers. By weight and value, trucks carry more freight across the country than every other mode combined, according to the most recent data from the Bureau of Transportation Statistics.
“Just losing a few truckers here and there could shut down a major portion of the supply chain,” Sarkis says. “Little things can be just as important as the big things.”
Then there is global vaccine equity. Some countries have been grappling with a higher burden of COVID-19 infections and deaths due to lack of access to vaccines. While economically developed nations are enjoying relatively high vaccination rates, including 6 in 10 Americans who are fully vaccinated, less developed nations with global shipping ports have much lower vaccination rates.
If there’s only one or two of a particular product on your local store’s shelf, take a look at where the product came from, whether in the U.S. or abroad. What’s happening at the point of production or along the route that product had to travel to get to the store?
To start, ask the business owner how that product is shipped to them, use the data sources highlighted in tip #5 to see if there are delays in the country or region of origin, and reach out to supply chain experts at a local university.
2. Be sure to interview academic researchers and experts from trade groups for context — and clarify their specific areas of expertise.
There are hundreds of academic supply chain management programs around the country, making it likely journalists can find professors familiar with local or regional supply chain issues and economies.
Peinkofer recommends experts from her own Michigan State, as well as from The Ohio State University; the University of Tennessee, Knoxville; Auburn University; and the University of Arkansas. The journal Operations Research is another place to find current research and academics studying supply chain management.
Sarkis says it’s important to clarify a supply chain researcher’s specific area of expertise, because their focus area will influence their answers to your questions. There are many fields of study that supply chain management encompasses — transportation and logistics, marketing and retail distribution, purchasing and procurement, operations management, labor studies and economics, to name a few.
“If you’re an outsourcing expert you’re going to look at, is outsourcing an issue?” Sarkis says. “If you’re a sustainability expert, is sustainability an issue? If you’re a finance expert, is it financial? And I bet you every single one of them could find the difference in how they study it to give you an answer.”
Experts from trade groups that deal with supply chain challenges can provide a professional, third-party perspective. Some of these groups include the National Retail Foundation, the Association for Supply Chain Management, the Council of Supply Chain Management Professionals, the Association of American Railroads and the American Association of Port Authorities.
Remember, though, that the main purpose of trade groups is to represent the interests of their industry members. Atkinson, speaking generally, cautions that journalists should “be wary of sources that are driven by an agenda. Like any question that involves public policy, it’s easy enough to find a source that confirms what you want to believe.”
3. Ask retailers about their resilience strategies.
“Resilience is a terribly misunderstood concept,” Atkinson says. “Resilience is the ability for a system to bounce back after a shock. That can mean it goes back to normal or it adapts to changing circumstances.”
For example, smaller retailers that might not have had much of a web presence before the pandemic have beefed up their ability to fulfill orders online, Peinkofer says. Retailers big and small now offer new ways for customers to acquire goods, such as curbside pickup.
While Walmart, Target and Amazon all say they are well-positioned, a boutique or mom-and-pop store will have very different and potentially interesting resilience strategies compared with big retailers, Peinkofer says. Here are some questions to explore about local retailers:
- How have businesses stayed resilient during the pandemic and how will they stay resilient if supply chain issues disrupt their flow of goods?
- For businesses that have survived the pandemic so far, how integral have resiliency strategies been to their survival?
- Do those strategies represent a new normal, or will local retailers pull back on them if COVID caseloads recede in a real way?
“I think having examples from actual retailers, that’s what makes it interesting and brings the story to life,” Peinkofer says.
Atkinson notes that despite the current supply chain challenges there have always been supply chain disruptions — think natural disasters, for example. Still, businesses tend to find a way to offer consumers what they want.
“Business is remarkable at coming up with product to sell us,” he says. “If there’s money to be made, they’re going to make it. Which is great. I worked in economic development, I love to see it.”
4. Keep in mind that supply chain stories aren’t just about empty shelves.
Not all localities will have stores with rows of empty shelves. But even if many goods are locally accessible, look at what’s happening with prices.
The rate of inflation growth just reached a 30-year high, with the Consumer Price Index rising 6% in October 2021 compared with the previous year. Data collectors from the U.S. Bureau of Labor Statistics record prices for 80,000 goods and services each month to create the price index.
That means consumer prices are relatively higher now than they were last year. Though the federal government recorded upward inflation across many types of products, it doesn’t necessarily mean that prices for every product will have increased 6%. Apparel, for example, is up 4% compared with last year. A good part of the current inflation has to do with rising energy costs, including elevated gas and diesel prices.
Even if stores are managing to keep their shelves stocked, ask if they’ve had to raise price significantly since the last holiday shopping season. If they have raised prices, why? Follow up with an academic expert for more information on whether price hikes are related to higher overall container shipping costs and higher energy costs, specifically. Inflation data by state and for select metropolitan areas, available here, can provide valuable context to your local story on retail price fluctuations.
It’s also worth exploring whether there is diminishing variety in the types of goods being produced and sold at stores big and small. As pandemic-related stimulus payments from the federal government rolled in last year, consumer spending increased. Overall consumer spending dropped nearly 10% from April through June of 2020, compared with the preceding three months. By the last three months of 2020, spending had nearly recovered to pre-pandemic levels. For July through September of 2021, consumer spending was 7% higher than during that same period in 2020.
Since the pandemic began, U.S. consumers have consistently bought goods at a higher rate than services — meaning there are more physical products needing to be moved around the world. To keep up with demand, some companies slowed the pipeline for their lower-selling products.
Reporter Kayla Canne, in a story for The Sun Chronicle out of Attleboro, Mass., interviewed Sarkis last summer about a shortage of SpaghettiOs with meatballs. Sarkis surmised that Campbell’s had increased production of its top selling products, at the expense of variety. It takes time to stop a machine and recalibrate it for another product.
“Shutting down some machines could take half a day,” Sarkis tells The Journalist’s Resource. Is a noticeable lack of product variety an ongoing issue in your coverage area?
5. Use data to explore whether anecdotes from shoppers and retailers represent outliers or trends.
“Look at the data,” Atkinson says. “Year over year, look at what’s happened in the past. Is this really something that’s terrible and something that’s different? There are always challenges. What’s different about this?”
Here are seven online resources that can provide a broader picture of the extent of shipping issues:
- GoComet, a private logistics firm, offers free, live port congestion tracking for many large U.S. ports. As of November 12, the Port of Los Angeles is experiencing an average delay for container shipments of 11 days. Those long delays have garnered significant media attention, with images of packed container ships waiting offshore providing a compelling visual story. The attention is not without good reason — Los Angeles has the busiest port in the country. But delays there aren’t necessarily indicative of what’s happening at other major ports. The average delay for the Port of Savannah in Georgia, for example, is 5 days. For the Port of Houston, the average delay is 2 days.
- The U.S. Bureau of Economic analysis has data on international trade, economic data for coastal areas and price differences across states and metropolitan areas.
- The U.S. Census Bureau’s Small Business Pulse Survey captures how supply chain disruptions are affecting small businesses along with a range of other questions, such as the change in prices businesses pay for goods and services and the percentage of businesses in a state that are having trouble hiring. The Bureau’s USA Trade portal, which requires a free sign-up, also offers data on specific commodities shipped through major port districts.
- Private firm Freightos offers some free data on container shipping costs globally and for specific routes to and from the U.S. While shipping prices remain historically high, costs have also eased in recent weeks.
- MarineTraffic allows for live tracking of individual cargo vessels, providing a visual representation of the flow of ship traffic through U.S. and global ports. Additional data costs money. There are several other websites that provide similar services. The federal government offers free lagging data on large vessels in U.S. ports and international waters, covering 2009 through March 2021. Some ship names and call signs aren’t available, but the data can be used to compile aggregate statistics and maps.
- U.S. Securities and Exchange Commission annual and quarterly reports can provide insight on how publicly traded companies are handling supply chain disruptions. Search by company here.
- Most Fortune 500 companies publish an annual sustainability report with detail on how they are responding to a range of issues, from climate change to corporate diversity to supply chain disruptions. Here’s one example, from IBM.
6. Search for silver linings.
The framing of a news story is often related to how a reporter frames their questions to sources.
“Just because you can’t get the gift that’s hard to get doesn’t mean you can’t get something good from your local community and support small businesses,” Atkinson says.
If retailers are saying certain products won’t be available or will have limited availability, reporters should consider whether being unable to buy a toy or piece of clothing represents a major tragedy or not. Are community members finding ways to enjoy the holidays despite perhaps consuming less?
“There’s something to be said for remembering a holiday and the spirit of the holidays,” Atkinson says. “It sounds cheesy, but it’s true. It’s not just about consumerism and the availability of product and what should we do to address supply chain issues. Holidays are going to happen. They’re going to be great.”
Download the links and sources in this tip sheet as a quick reference guide: