Shipping Snags Force U.S. Firms To Abandon China As Supplier

Game maker Eric Poses last year created The Worst-Case Scenario Card Game, making a wry reference to the way the coronavirus had upended normal life. He had no idea.

Photo Insert: The Port of Seattle against the Seattle skyline

In a twist that Poses never could have predicted, his game itself would become caught up in the latest fallout from the health crisis: a backlogged global supply chain that has delayed shipments around the world and sent freight costs rocketing.

Worst-Case Scenario, produced in China, was supposed to reach US retailer Target’s distribution centers in early June. Instead, the games were stuck for weeks at the Port of Seattle and didn’t arrive until mid-July, Paul Wiseman reported for the Associated Press (AP).

Like other importers, Poses is contending with a perfect storm of supply trouble — rising prices, overwhelmed ports, a shortage of ships, trains, trucks — that is expected to last into 2022.

The experience proved disturbing enough that Poses is reconsidering a cost-saving decision he made five years ago: to shift production of his games and toys out of the United States to China.

Now, he thinks, it might make sense to bring production back — at least to Mexico, if not the United States — to protect him from the risks of relying on factories an ocean away in China.

Other American companies are making similar calculations: 52% of the US manufacturing executives surveyed by the consulting firm Kearney said they have started buying more supplies in the US in response to COVID-related supply disruptions.

Forty-seven percent said they plan to reduce reliance on supplies or factories from a single country; 41% specifically said they wanted to cut their dependence on China.

And not just because of the virus-related bottlenecks in shipping, severe as they are. Companies are worried, too, about becoming caught in the crossfire of a trade war between the United States and China, the world’s two biggest economies.

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