February 9, 2021
Reports blaming shipping delays and port issues for appliance shortages are not correct, according to Amdea chief executive Paul Hide, who says high demand is the real problem.
Hide was a guest on The kbbreview Podcast with CEO of the Bathroom Manufacturers Association (BMA), Tom Reynolds, to talk about the current issues with ports, shipping and imports.
Hide believes that it is the high level of demand that is causing the delays, although he admits that the shipping crisis has not helped.
He said on the podcast: “I’m not hearing any manufacturers in Europe tell me that their manufacturing has been disrupted by running out of components. There are supply shortages, but that is not the issue with large appliances – it is due to record demand.
“Last year, there were 12 million large appliances sold, and the market grew. After a very weak second quarter after the first lockdown, where sales plunged 30%, we saw a massive recovery and went from business talking about how they would be down in 2020 to pretty much all our members being up in terms of volume.”
Reports indicate that most of the shipping issues are due to containers going to and from the Far East and empty containers being in the wrong ports. There are also issues at British ports, with dock workers being off sick or self-isolating as well as problems with new Brexit paperwork.
Hide explained: “It [shipping delays] affects larger appliances less as those that we tend to sell and buy in the UK are made in and around Europe. They tend to not be made in the Far East and European models specifically are made in Italy, Germany, Turkey and eastern European factories. But what has really been affected is small appliances – as 80% of these come out of the Far East and China.
“Even large appliances that are made in Europe require components from the Far East. But the feedback we are getting is there is a higher risk with finished goods. You can get an awful lot in a 40ft container, but you can leverage that against many thousands of machines down the line.
“Prices will settle, but the question is how soon and how quickly? We won’t see a price crash, as the market is controlled by five major shipping players, and there is no end to this high demand.”
Hear the full interview on how the shipping crisis could cause delay and price rise on the latest episode of the award-winning kbbreview Podcast. Listen now using the player below or search ‘kbbreview’ in a podcast app such as Apple Podcasts or Spotify.
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