Premier Film Distribution has received a shipping update from a global vendor regarding international shipping. We know that COVID-19 has impacted operations and shipping however, we have not known the full extent of the distribution issues at the beginning of the production process.
Ports across the globe, especially Shanghai, are at capacity and congested. The demand from China for PPE and medical supplies from Asia is overwhelming as most shipping containers are carrying masks and hygiene products rather than regular commodities. Not all films supplied by PFD are made in China however, some raw materials are sourced from Asian countries which has an effect on the entire supply chain.
Materials and commodities shipped from the USA to China is ⅕ of what is was before COVID-19 hit globally meaning China also has a shortage of shipping containers. A flow on effect of these shipping delays means Australia has an abundance of empty containers which can’t be shipped over fast enough.
A lot of businesses have needed to evolve their operations in order to survive. This means traditional brick and mortar businesses have shifted to selling online. Many entrepreneurs and work from home individuals started their own online based businesses with a large surge in online shopping in fear of COVID-19 in local communities. Coming into mid February, Chinese New Year causes a surge in online purchasing and a week of national holidays within China is only going to delay production and shipping further while increasing the cost of international shipping.
It doesn’t stop at shipping however. Air freight is a fraction of what it used to be pre COVID-19. Flights and air travel have declined meaning freight companies such as DHL have to use their dedicated cargo planes of which there aren’t enough for the volume or demand. We are working closely with our suppliers however, our suppliers are experiencing 3-4 weeks delay on shipping containers. As a result of this, they are constantly playing catch up with out of stock products.
What does this mean for our loyal PFD customers? There is a 40% increase in shipping costs, high demand and shortage of products. These costs must be absorbed throughout the entirety of the process meaning our customers may experience an increase in price and shortage of products.
We are extremely grateful for the updates and communication from our suppliers which we can pass onto our customers. We appreciate your patience and understanding at this time. We believe that all businesses have done their absolute best in these times of uncertainty and hope to continue operating with the ongoing support from our customers.