China’s outbreak of the Coronavirus is disrupting the sportswear supply chain globally and even if you are not sourcing within China, the likelihood is, your goods are also going to be affected.
China has been on lockdown for weeks and factories are only just starting to come back online, some 10 days later than scheduled after the Chinese New Year and it’s anyone’s guess when factories will fully reopen and get back up to speed.
Many of the merchandisers have been communicating over the last week via skype and email but most have been working from home as factories were under government lockdown.
China has started to allow movement again outside the epicentre of the virus and factory workers are now starting to come back to work, however the issue won’t resolve itself anytime soon. Many of the workers are now reluctant to travel far away from their hometown or cities and this will lead to a huge recruitment issue for all factories who will find themselves with a huge shortfall of returning workers.
This scenario happens every year after Chinese New Year but not to this scale and the disruption will be felt by further delays on orders and samples until the workforce is replenished and training is complete.
We spoke to one factory who today (26th February) advised that they hope their workers will return by end of the 1st week of March, however the samples we were expecting from them 2 weeks after Chinese New Year will now probably be delayed until the end April/start May. The main issue is the lack of highly skilled sample room machinists and pattern cutters that don’t return will need to be recruited and then trained and brought up to speed on existing programs.
This issue of skilled workers not returning will affect every factory across all industries and this will then have a huge knock on to the development and supply of goods sourced from China.
The issue however doesn’t stop with Chinese supplied goods. Our European factories have seen a huge increase in developments and orders since the virus started as brands switch from China to EU factories in the hope to navigate around the then localised issue. This has resulted in them becoming inundated with enquiries, samples and orders and has stretched their capacities to full.
One of our European factories has refused to take on any new projects until May/June as they cannot cope with the increase in recent enquiries and orders and warned of lengthy delays to samples and lead times on production.
Many EU factories source components, fabrics and fibres from China and this again has a knock-on effect to samples and orders produced globally. Fibres, Fabrics, trims and components are now being delayed or having to be resourced that again is stretching these suppliers and causing further delays.
Courier firms in China have also been affected with a huge backlog of packages and parcels waiting to be shipped from their hubs across China. These hubs are currently clearing the backlog and will resume normal lead times on shipments soon, however the delays in getting goods to factories and brands have all delayed the development or production lead times.
The latest outbreak in Europe of the Coronavirus will again further disrupt the supply chain as effected areas become locked down and restrictions on movement become commonplace.
The conclusion is ….. well, there isn’t a final conclusion yet. Things are developing and changing on a daily/hourly rate but be sure of one thing, the lead time of all developments and production will be affected regardless of whether your sourcing in China or Europe.
We are in daily contact with our suppliers and will update our clients when we have something more conclusive to report.