We have all read in the press about the worsening state of stock availability and soaring shipping costs.  To quantify this, at RPD we’ve seen 40ft container prices rising from c.$2,000 (SZN>FXT) to as high as $25,000 over the last 2 years, resulting in many products becoming completely unviable to ship.
 
The knock-on is weirder than you think - in North America, the shortage of organic milk was not due to a lack of cows, but a lack of the jugs and bottles used to distribute the products!
 
With bottles being manufactured in China and shipped by sea, those 40ft containers were up to 95% full of air, by volume, due to the design of the jugs and bottles. As a result, with shipping prices as high as they currently are, the shipping cost far exceeds the cost of the goods inside.
 
The result is often full containers being sat around the world, waiting for costs to re-align.
 
As a direct result of these cost increases, businesses have finally been forced to put the money and time behind diversifying their supply locations and localising production lines.
 
Good news for future stability, but more importantly better news for the planet!
 
Whilst China remains unparalleled in supply chain density in both complex and simple products, some long-distance involvement in supply chains have become infeasible.
 
It is still common for products to be shipped around the world for various processes, before returning for final assembly, however, this effort to spread supply chains has included huge investment in Europe as the potential future of consumer electronics and goods manufacturing.
 
Here at RPD, we are about to open our first European manufacturing office in Porto, Portugal, which we see as the hub of manufacturing in Europe going forwards.  We are committed to supporting our clients and our community to find sustainable solutions for the future of supply chain.