A major importer of baby equipment says shipping container delays means it’s taking six months before it can collect money from customers for stock it has paid for in advance.
Mark Edwards, managing director of Auckland family-owned pram, stroller, and infant car seat business Edwards & Co, said it’s difficult to say how many sales have been lost because of the global container shipping congestion that’s helped choke Auckland’s imports port for months, but cash flow is an issue and the company’s shipping costs have doubled.
The business, a national leader in its sector, is also paying congestion surcharges imposed by shipping lines on containers landed at Auckland’s port.
It will have to put up its prices to meet the increased shipping costs, Edwards said.
“We are currently waiting on $400,000 worth of bills that would have been paid in December, but won’t get paid until Feb 20 now as our customers only pay on the following month on stock we can ship (deliver).”
Edwards & Co sells to retailers and individuals.
“We have to pay for this stock in advance, and right now it’s taking six months before we collect the money from our customers.”
Right now it’s now waiting for eight containers it was advised by its shipping line would arrive in Auckland mid-January, but are not now due to be unloaded until February 12.
“But that can change at the drop of a hat,” said Edwards.
Four containers of infant equipment due on the wharf at the end of November were eventually unloaded on Boxing Day and the whole Edwards family pitched in to empty them, he said.
“I gave my own car seat to some parents to get their new baby home.”
Edwards said the situation can only go on another four or five months before it gets “serious”.
While the business has been struggling to get enough stock, demand had been going up.
“Sales have increased. It’s hard to know if there was a (lockdown) baby boom, I’ve only seen birth statistics to the end of September. But as a brand we’ve been growing anyway. People are buying more accessories. They’re more willing to buy add-ons and I have a theory that grandparents are buying more.”
Edwards was not sure if that was because more cash was rolling around the economy because Kiwis can’t spend on overseas travel, but noted the business sold only in the mid-range price bracket anyway.
His father Warwick Edwards, a director of the company, is frustrated “beyond belief” about the container unloading delays at Auckland, and blames the Ports of Auckland.
“Whatever the spin doctors at the ports say, the shipping delays in this part of the world are caused by Auckland. It all started when they tried to automate the unloading of the ships which was a complete failure.
“They laid off the staff that worked the machinery and now they blame a labour shortage.”
But Ports of Auckland spokesman Matt Ball said the delays are not caused by automation “which is working fine”.
“They are caused by not having enough staff for the current Covid-disrupted environment, which has had multiple impacts on our operation.”
He said the Auckland Council-owned ports company was sorry about the delays and the impact they were having on importers.
“We have more labour working now and more coming on stream soon, so if we can bring ships in sooner, we will.”
Ball said the ship carrying the eight Edwards & Co eight containers would wait 15 days at anchor off Auckland, but this was unusual.
It could never have arrived at Auckland mid-January because it only left Hong Kong on January 15, he said.
The “unusual” long time at anchor was partly because the vessel was a monthly service which only called at Auckland, so unlike other container ships, could not make changes to its service pattern to avoid waiting off Auckland, and in part because of the two public holidays – Auckland Anniversary and Waitangi Day – over this period.
While the ports worked as normal over public holiday weekends, other parts of the supply chain did not.
“On average there is a 5-11 day delay from the first arrival time we are advised of and the time the ships’ berth,” Ball said.
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