The show goes on for Amazon Prime Days despite supply chain issues

With day two of Amazon Prime Days wrapping up today, many consumers, at this point, may view this event differently than in the past, or before March 2020, when the COVID-19 pandemic initially took hold on a wide scale in the United States.

The reasons for that are pretty straightforward, to be sure. On a top level, the pandemic forced nearly everyone to shelter in place at home, with retail locations closed, or only offering limited access (like curbside delivery). Another factor has to do with how e-commerce networks went into overdrive, with people buying lots of “stuff,” ranging from paper products to perishables to Peleton bikes and most everything in between.

Amid all of this, whether it is what we all dealt with and went through during the dark days of the pandemic and now, at a time when there is cautious optimism in regards to the re-opening of the economy, in tandem with more people getting vaccinated and the flow of federal stimulus funding into the wallets of many consumers, is the supply chain.

Of course, it is! The supply chain and logistics have been front and center, given the uptick in demand and the supply chain challenges that have subsequently arisen. Again, these challenges are not new, and they include things like: labor issues like: the ongoing driver shortage; port congestion; record-low inventories; record-high inventories; and service issues and delays, among others.

Many of these challenges, of course, have been intact beforehand, of course. A recent CNBC report published shortly before Amazon Prime Days touched upon the myriad supply chain-related issues that could impact things operationally.

One main challenge cited in the CNBC report focused on how businesses are being hit hard by global shortages of shipping containers and semiconductors, and another was how some sellers are worried they may run out of stock. These are not minor challenges at all.

This analysis from the report is pretty telling: “Several cascading issues are hitting businesses at once. The global supply chain is still feeling the ripple effects of the Covid-19 pandemic, which forced many factories to shut down temporarily amid worsening outbreaks of the virus. Supply chains have been further disrupted by shortages of shipping containers and air freight capacity, along with materials like semiconductors and plastics. Labor shortages have caused major backlogs throughout the system.”

Rick Watson, founder and CEO of New York-based RMW Consulting, explained that the uneven nature of the economic recovery from the pandemic, especially for those shippers with global customer bases, will continue to see supply chain challenges, especially on the inbound side.

“As we get through Amazon Prime Days, most retailers were worried about it [in advance], and now that focus will shift to the holidays,” he said. “It is like they are hitting a button on the supply chain and nothing is coming out the other end, and they are having frantic conversations with suppliers, for when they can expect inventory.”

As for why Amazon bumped up the timing of Prime Days to earlier in the year [it was in October in 2020 and in 2019 it was in July], Watson said it stemmed from it seeing an opportunity to start testing out their systems prior to the holidays to get a read on what capacity may be like. And he added that things this year seem pretty steady overall for Prime Days.

Looking at everything that has happened over the last 16 months, maybe consumers were more prepared for Prime Days than in the past, but, unfortunately, supply chain issues have never been more front and center. We will all buy online, and the good we order will be delivered, but patience will be required, and lessons will be learned along the way.